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This briefing sets out the current state of Multiannual Financial Framework negotiations for the 2028–2034 EU budget period; what Ireland’s upcoming Council Presidency means for those negotiations; and the key client considerations emerging across corporate tax, energy and regulation.
On 23-24 April 2026, EU leaders meeting in Cyprus agreed to move the Multiannual Financial Framework (“MFF”) negotiations for the 2028-2034 budget period into a more structured phase. Discussions will now continue on the basis of the negotiating box, with work underway to introduce indicative figures ahead of a further European Council (“Council”) scheduled for 18-19 June. Council President António Costa subsequently confirmed that the Cyprus Presidency will prepare and table the first proposal containing actual figures for the MFF at the June summit, noting: “We have a collective responsibility to reach an agreement by the end of the year. Only in this way can we ensure that the next framework will be put into effect from the beginning of 2028.”
This moves the process into a more defined negotiating phase and has immediate relevance for Ireland as it prepares to assume the Presidency of the Council of the European Union (“Presidency”).
What has changed in the MFF negotiations?
The emphasis is now shifting from general positioning to more detailed negotiation. As figures begin to emerge, trade-offs that have been implicit to date are likely to become more visible, particularly across defence, support for Ukraine, competitiveness, energy security and migration.
Agreement remains some way off. While there was broad recognition in Cyprus that the current geopolitical environment requires a different level of ambition, and therefore cost, no consensus has yet formed around the overall size of the budget, the role of borrowing, or the future composition of EU own resources. Two distinct camps have now formed among Member States: a fiscally cautious group including Germany, Sweden, Austria and the Netherlands seeking a budget cap closer to 1.1% of EU GNI, while a coalition of sixteen Member States, including Italy, Spain and Poland, has pushed back against any reduction in budget ambition. At the April summit, Germany and the Netherlands, the two largest net contributors, warned that a €2 trillion budget was “unrealistic” given their respective national fiscal constraints. On own resources, the European Commission’s (“Commission”) proposals will form the basis of discussion, alongside proposals emerging from the European Parliament (“Parliament”), including potential additional revenue streams in areas such as digital services.
What is the position regarding own resources?
The own resources debate is likely to be one of the more closely watched elements of the negotiations from an Irish perspective. Proposals for new taxes to fund own resources have been floated by both the Commission and the Parliament. Those taxes are varied and include a tax on corporate turnover, a digital services tax and taxes on gambling and tobacco. Revenues from emissions-linked trading and the carbon border adjustment are also in the frame. All of the proposals inevitably raise broader questions around competitiveness at Member State level.
Ireland shares those concerns with many other Member States and none of the proposals so far have received even lukewarm support. That tax proposals require unanimity means reaching agreement on own resources will be challenging.
For clients, this is an area that warrants close attention as positions begin to firm up.
Where does Ireland stand in the MFF?
Ireland has already started to signal where it sees its interests. Its participation, alongside a group of like-minded Member States, in a non-paper on the proposed European Competitiveness Fund is one example of that.
That kind of alignment is likely to matter. It reflects not just policy preference, but also the alliances Ireland will need to manage carefully once it moves into the Presidency role. A concrete illustration of how Ireland is already navigating that dynamic emerged on 26 May 2026, when Ireland declined an invitation to attend a meeting of ministers from net contributor Member States convened ahead of a key MFF ministerial session. Minister of State for European Affairs Thomas Byrne explained: “I’m very, very conscious that there are different views around the table for the MFF. We, as Presidency, when we start in July, will need to be the honest broker in the MFF negotiations, and we take that role very, very seriously. I don’t want to start falling into camps on the MFF at this particular point.” Ireland’s permanent representative attended the meeting as an observer only.
What is the European Parliament’s position?
The Parliament will add another layer to the process. On 28 April, it adopted a more ambitious approach to competitiveness and defence spending, following the adoption of an interim MFF report in plenary, the Parliament’s formal mandate for negotiations with the Council, alongside a willingness to consider additional revenue sources. On tax matters, however, the Parliament has an advisory role only. Accordingly, own resource proposals for new taxes emanating from the Parliament are often less likely to reach fruition.
Managing that dynamic will fall, in part, to Ireland. The Presidency role sits at the centre of the interinstitutional process, requiring a balance between Member State positions and parliamentary ambition. That balance tends to come into sharper focus at key moments, and this process will be no different.
How is the economic backdrop affecting negotiations?
The wider context has also become more challenging. Disruption to shipping routes in the Middle East has fed through into higher EU fossil fuel import costs, with knock-on effects for energy markets more broadly.
For businesses, that points to continued pressure on energy costs and supply chains. At a political level, it reinforces the case for directing additional funding towards energy security, which in practice means more difficult choices elsewhere in the budget.
What does Ireland’s EU Presidency mean for the MFF?
The MFF timeline will run through the Presidency, with further Council engagement expected later in the year as negotiations intensify. The Cyprus Presidency is expected to bring forward a negotiating box containing broad budget amounts at the 18-19 June European Council, after which Ireland assumes the Presidency in July. As noted above, Council President Costa has confirmed a political target of concluding agreement by the end of 2026, though some Member States have not ruled out a delay into 2027.
That places Ireland at the centre of the most consequential phase of the process. By the time it assumes the Presidency, positions on the core parameters, including overall size, own resources and reprioritisation, will need to be clearer.
As always in MFF negotiations, that balance will be difficult to maintain. Ireland will be expected to act as an effective broker, while at the same time managing its own interests as a fiscally cautious net contributor.
Key considerations for businesses
What are the tax implications of the MFF?
Developments in the own resources debate, particularly those involving taxes and ETS-linked revenues, should be factored into ongoing tax monitoring and risk assessment. The unanimity requirement for tax proposals will strongly influence the direction of travel which is likely to take shape over the coming months and will form part of the wider balance of the MFF package.
What should energy-exposed businesses be doing now?
Continued volatility in energy markets is likely. Businesses with significant exposure should be looking carefully at pricing mechanisms, contractual protections and hedging strategies.
How will the MFF shape the regulatory landscape?
The MFF will shape EU funding priorities for the next decade across competitiveness, defence, climate and cohesion. Early engagement will matter for those in affected sectors.
How can businesses engage during Ireland’s Presidency?
Ireland’s role during this phase creates a window for engagement. For businesses with a stake in EU policy outcomes, the period leading into and during the Presidency will be an important one. This includes monitoring developments closely as negotiating positions evolve, engaging with national and EU-level stakeholders, and contributing to consultations or industry forums where relevant. Early engagement can help shape perspectives on key issues such as tax, energy and competitiveness, while ensuring that business priorities are clearly understood by policymakers as the negotiations progress.
To stay up to date with the latest strategic insights in relation to Ireland’s upcoming Presidency, visit Matheson’s EU Presidency Hub.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
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