Germany demands $450bn cut to 'unaffordable' EU budget, document shows

Berlin says reduced EU budget still keeps Germany's annual contribution above €50 billion

The flags of the European Union, Poland, France, Germany, Italy, Britain, and NATO on the balcony of the chancellery during the European Group of Five (E5) heads of state meet in Berlin, Germany, Jun 24, 2026. Michael Kappeler/Pool via REUTERS

Germany is demanding a €400 billion ($456 billion) cut to the European Commission's proposed budget of €2 trillion for 2028-2034, warning that the current plans are "unaffordable," according to an internal government document seen by Reuters on Tuesday.

Because the EU budget, called Multiannual Financial Framework, requires unanimity among all 27 member states, Germany's sharp opposition signals a tough battle ahead, with Berlin warning in the document that "as it stands, an agreement is impossible."

As the EU's largest net contributor, Germany is alarmed by the proposed scale of the next seven-year budget, which is a significant increase from the €1.3 trillion budget for 2021-2027.

Berlin argues that even with its proposed €400 billion trim, the budget would still be 27 percent larger than the current one, pushing Germany's annual contribution to over €50 billion.

Chancellor Friedrich Merz has urged member states to seal a deal this year to ensure planning certainty before the budget takes effect in January 2028, especially with major elections looming in France, Poland and Italy in 2027.