To generate additional resources for the budget, Costa’s team also suggested increasing two largely uncontroversial taxes on non-collected plastic and electronic waste that flows directly to the bloc’s budget by levying an additional 25 cents on each kilo.
The diplomats also proposed raising the share of a carbon imports’ tax that flows to the EU cash pot to 100% from the current 75%, and exploring levies on crypto firms and national spectrum auctions.
In a further concession, Lourtie suggested phasing in two taxes on tobacco products and polluting firms, known as the Emissions Trading System, for countries that are overwhelmingly affected.
Confessional diplomacy
The bilaterals, which started Thursday and will continue until next Monday, are expected to pave the way for a budget deal by the end of 2026 — before next year’s elections in Poland, France and Italy threaten to derail the negotiations.
Costa will put forward a new budget negotiating document on Nov. 21 ahead of a special summit the following week, said the two diplomats.
During Thursday’s meetings, Costa’s team signaled that the budget would be cut further, and reductions might affect regional funding known as cohesion policy.
That would be a major setback for an alliance of Southern and Eastern European countries, known as the Friends of Cohesion.
Cuts to farmers’ subsidies were deemed less likely, said the two diplomats.
