EU Commission: European recovery plan and next long-term budget to use €1.85 trillion

The European recovery plan and the next long-term budget will use €1.85 trillion to kick-start the EU economy, Reuters reported on Wednesday, citing the official European Commission document.

Key takeaways

"EU Commission proposes new revenues for the EU budget that could include revenues from ETS trading scheme, carbon levy on imports and corporate tax."

"EU Commission proposes the EU budget could also get funding from a new digital tax."

"New proposal for the EU's long-term budget is 1.1 trillion euros over 7 years."

"EU Commission proposes to borrow and then disburse to EU countries 500 billion euros in grants and 250 billion euros in loans."

"EU Commission proposes to start repaying the borrowing for recovery after 2027, the maximum maturity of bonds to be 2058."

"EU Commission proposes new solvency support instrument of 31 billion euros."

"EU Commission's proposal on new revenues for the EU budget are in addition to the proposal for bigger revenue from VAT and a new tax on non-recycled plastics."

"EU Commission proposes 32.5 billion euros extra for the EU just transition fund for moving to a greener economy."

Market reaction

The EUR/USD pair largely ignored this statement and was last seen gaining 0.35% on the day at 1.1020.