If you are trying to fund the European Union’s next long-term budget and you want fresh money that flows directly into EU coffers — “own resources”, in the Brussels phrase — the most obvious place to look is the large American and global tech companies selling digital services across the continent. The European Commission looked and saw one number. The European Parliament looked at roughly the same thing and saw a number five times bigger. The arithmetic is the same; what differs, entirely, is whom you count as taxable.
The bigger figure comes from Danuše Nerudová, a Czech MEP from the European People’s Party, who asked Parliament’s in-house services to estimate the yield of proposed EU-wide levies on digital services, online gambling and crypto assets. According to Parliament’s estimates, seen exclusively by Euronews, the digital levy alone could raise up to €25.2bn a year — five times the Commission’s figure. “The European Parliament is calculating with a much broader tax base than the Commission,” Nerudová told Euronews. “The tech space also covers, for example, streaming and data processing services, which the Commission completely omitted.” Parliament’s draft widens the scope well beyond advertising and intermediation services and raises the rate from 3% to 5%; the Commission’s estimate was built on the existing digital services taxes in France, Spain and Italy. “This is a very conservative estimate, even though it’s much higher than the Commission’s proposal,” she added. “But the huge difference is the tax base we are using in our estimates.”
The pattern repeats on the other two proposals. Parliament’s estimate for a tax on online gambling is €3.9bn against the Commission’s €1.9bn, and it puts a capital gains tax on crypto assets at €3bn versus €2.4bn. Each of those has its own politics. The gambling tax faces stark resistance from Malta, which hosts the European headquarters of many online betting operators — a small state defending a large local industry, as small states do. The crypto tax is generally regarded favourably but as very hard to implement: easy to circumvent, and hostage to a market whose taxable base can halve between budget drafts.
Why does anyone need the money? “We need new own resources to cover the repayment of the joint debt and to fund new priorities in the EU budget,” Nerudová said. EU countries are scrambling to agree the next Multiannual Financial Framework by the end of the year, ahead of the new budget period starting in 2028, and own resources are the flashpoint. Nerudová concedes negotiations are already behind schedule.
Then there is the constituency of one across the Atlantic. Several member states have expressed scepticism about a digital levy over what Euronews describes as “geopolitical concerns” — the risk that the US government retaliates with new trade measures against a tax that would fall mostly on American companies. Washington has already inserted itself into the EU’s tech-rule fights, so the concern is not exactly hypothetical. Nerudová’s rejoinder is that the retaliation seems to arrive anyway: “These reactions are coming even without the digital 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. This is the right tool to raise money for the EU budget in a sustainable way.”
On feasibility, she draws a line between her two hobbyhorses: “The crypto asset tax might be complicated, but a digital levy is quite easy to implement at EU level.” Which may be true. The harder question is the one the two estimates quietly pose: a levy worth €5bn or one worth €25bn is the same policy, differing only in how much of the internet you decide is in it. That decision is the whole negotiation.