A proposal to tax countries that do not increase their defense budget is viewed in Rome as being inspired by the German government. The proposal indeed, published by the Brussels-based Breugel think-tank, was initiated by Armin Steinbach, who is a candidate to become chief economist for German Finance Minister Lars Klingbeil. Steinbach has previously been a government official in the past.
The report suggests that countries that do not spend enough for rearmament should pay a higher contribution to the EU budget. The latter is primarily funded through member state contributions, in proportion to their GDP. “To boost [EU budget] revenues … countries can either pay more in, based on their gross national incomes (GNI), or agree to new revenue-raising mechanisms,” the report suggests. “In this context, we recommend a new EU budget resource that would address an imbalance in national defence spending and incentivise low-spenders to spend more.”
