European Commission President Ursula von der Leyen called Monday for the creation of an independent EU tax authority by 2028, a proposal that reignites fundamental debates about European integration and the balance between Brussels and national capitals.
Speaking at a conference in Brussels, von der Leyen argued that the EU requires "own resources"—taxes collected directly by European institutions rather than contributions from member states—to fund ambitious programs on defense, climate transition, and industrial policy. "We cannot build European sovereignty on borrowed money and voluntary contributions," she declared, according to Politico.
The proposal envisions an EU tax service with authority to collect revenue from sources such as carbon border adjustments, digital services taxes, and potentially a harmonized corporate tax. Proponents argue this would reduce the EU's financial dependence on member state budgets and eliminate the contentious annual negotiations over national contributions that have paralyzed Brussels policymaking.
Yet the plan faces fierce opposition from multiple directions. Wealthy northern European states—particularly the Netherlands, Sweden, and Denmark—oppose creating what they view as a backdoor European superstate with power to tax citizens directly. Eastern European nations fear Brussels would use fiscal leverage to impose policy conditions they find objectionable.
"This is federalism through the back door," said Geert Wilders, leader of Netherlands' largest political party. "We will never accept EU bureaucrats taxing Dutch citizens."
Even supporters acknowledge the political challenges. Any change to EU revenue structures requires unanimous approval from all 27 member states, a threshold that has proven nearly impossible to achieve on controversial matters. Von der Leyen has less than two years remaining in her current term, leaving little time to build the necessary coalition.
The deeper question is whether the EU should evolve toward fiscal federalism similar to the United States, or remain a confederation of sovereign nations with limited collective authority. Von der Leyen has bet her legacy on pushing toward greater integration, arguing that only a fiscally independent EU can compete with China and maintain strategic autonomy from the United States.
Critics counter that such ambitions exceed the EU's democratic mandate. As one Eastern European diplomat told Politico: "Taxation without representation started one revolution. Brussels shouldn't forget that lesson."
