As negotiations over the European Union's next long-term budget reach a critical stage, new figures from the European Parliament suggest that a proposed EU-wide digital levy could raise as much as €25.2bn per year—five times the amount originally estimated by the European Commission. The revised projections, shared exclusively with Euronews by Czech MEP Danuše Nerudová, could reshape the debate over how to finance the bloc's priorities and repay its joint debt.
The Parliament's proposal expands the scope of the levy well beyond the Commission's initial design. While the Commission based its calculations on existing digital services taxes in France, Spain, and Italy—focusing mainly on advertising and intermediation services—the Parliament's version covers a much wider range of digital activities, including streaming and data processing. It also raises the proposed tax rate from 3% to 5%.
“The European Parliament is calculating with a much broader tax base than the Commission. The tech space also covers, for example, streaming and data processing services, which the Commission completely omitted,” Nerudová told Euronews. She described the new estimate as “very conservative,” despite being significantly higher than the Commission's figure, because of the expanded tax base.
The stakes are high. EU member states are scrambling to agree on the next Multiannual Financial Framework (MFF) by the end of the year, and the introduction of new “own resources”—revenue streams that flow directly into the EU budget—remains a key point of contention. Several frugal states have demanded deeper cuts to the budget, complicating the search for a compromise.
Divergent estimates and political hurdles
The Parliament's figures show a stark contrast with the Commission's projections across all three proposed taxes. For online gambling, the Parliament estimates a yield of €3.9bn annually, more than double the Commission's €1.9bn. For a capital gains tax on crypto assets, the Parliament projects €3bn, compared with the Commission's €2.4bn.
However, these proposals face significant political obstacles. The tax on online gambling has drawn sharp resistance from Malta, which hosts the European headquarters of many online betting operators. The capital gains tax on crypto assets is generally viewed more favourably, but experts warn it would be difficult to implement, given the ease of circumvention and the volatility of cryptocurrency markets.
Nerudová acknowledged that negotiations are already behind schedule, raising questions about whether the Commission could implement the taxes in time for the start of the next budget period in 2028. “We need new own resources to cover the repayment of the joint debt and to fund new priorities in the EU budget,” she said.
Several member states have expressed scepticism about a digital levy, citing “geopolitical concerns”—namely, the risk that the US government could retaliate with new trade measures. But Nerudová dismissed these fears, arguing that such reactions are already occurring regardless of the levy. “We have a lot of tech giants here, running their business all around Europe without paying a fair share. This is the tool to tax those companies, which are not on the same level playing field as the European ones,” she said.
The debate over the digital levy comes as the EU seeks to bolster its financial autonomy and address the challenges of a rapidly digitising economy. The Parliament's proposal, if adopted, would represent a significant shift in how the bloc funds its activities, potentially setting a precedent for other regions. As the negotiations intensify, the outcome will have far-reaching implications for the EU's budget and its ability to invest in priorities such as the green transition, digital transformation, and security.
For now, the ball is in the court of the member states, who must weigh the potential revenue against the political and economic risks. The coming months will be crucial in determining whether the digital levy becomes a reality—and at what scale.
