The 27 EU States decided on Tuesday, a drastic change in the financial architecture of the Union. On the one they created for the first time with the Corona-building Fund a huge special pot in addition to the regular EU budget framework from 2021 to 2027 in the amount of 750 billion euros. The other is to change the financing of the EU fundamentally. Here are the main Details:
Because of the Corona-crisis and the economic collapse of the EU summit decided to arrange a special Fund of 750 billion euros for particularly affected countries. 390 billion euros to be offered as grants , 360 billion as credits . 70 percent of which will be spent in the years 2021 and 2022, 30 percent are reserved for the year 2023. The distribution mainly depends on how strong the economic power is shrinking in the years 2020 and 2021. In 2022, the payments for 2023 will be checked.
The affected States to submit plans for the use of, the checks by the EU Commission within two months. The criteria depend on the country-specific recommendations, the EU Commission draws up anyway. A prerequisite for the release of funds should be, that money will also be used for climate protection and digitization projects. The EU governments must approve the Commission decision with a qualified majority. This is not to guarantee that the grants be included in the normal budget of the EU States. If "one or more" governments in doubt, you can apply for a debate on the next EU summit.
FINANCING AND REPAYMENT
for the First time, the EU is allowed-Commission, on a large scale to take on debt. The bonds about 750 billion euros, will run until the year 2058. The repayment is to start before 2027 and the EU budget are made. The Federal government had emphasized that the uniqueness of the crisis, this unique promotional campaign is finished. This should not be an entry into a "debt Union". The French President, Emmanuel Macron praised on Tuesday, however, that the EU is doing now for the first time, a common debt.
the repayment of the large sum from the EU budget, not the normal work of the EU lame, the EU, my sources . In the beginning of 2021 will be a plastic surgery tax introduced on non-recyclable plastic. In addition, the EU will develop Commission plans for a digital tax and a CO2 tax . This will be introduced "at the latest, 2023". With the border tax on imports from countries will be hit, which do not have stringent climate protection targets of the EU. This is to guarantee equal conditions of competition for EU companies, especially as the EU plans at the same time, an increase in CO2 pollution rates. In addition, the air and ship traffic should be included in the emissions trading . As a separate source of revenue for the EU a financial transaction tax will be introduced. The new revenues should be used for the early repayment of the bonds in the construction Fund, - stated in the decision.
the EU budget framework
in addition, the EU decided to the normal budgetary framework of the Union from 2021 to 2027. This should have a volume of 1,074 trillion Euro . Because the UK leaves the EU, must be compensated for the gap in the British contribution. Therefore, the payments especially the net payers such as Germany in the coming years will increase significantly. After the abolition of the UK rebate, the rebate system had to be negotiated in the EU. The EU is holding on to the discount scheme – however, for Austria, the Netherlands, Sweden and Denmark to rise very much stronger than for Germany relieved less.
rule of LAW
The linking of EU payments to the rule of law was one of the dispute – the part is. The decision is now limited to two elements: firstly, it is emphasized that the financial interests of the EU must be respected and the rule of law rules are important. On the other hand, the Commission is tasked with a concept to present as a "Regime of conditions for the protection of the budget" can be introduced. The EU Council should adopt measures in case of a breach of these rules by a qualified majority, this is likely to once again trigger a heated debate. Since, however, no unanimity in this decision necessary, increases the likelihood that the rule of law infringements can be sanctioned.Updated Date: 21 July 2020, 07:20