In seven years, Italy has paid 116 billion to the EU

Italy’s Net Contribution to the European Union

Being a net contributor means paying more than receiving.
Italy has played this role in its relations with the European Union for several years.
Judging by the financial flows between Rome and Brussels, Italy could still be defined as such.
However, there is a game-changer: the funds coming from the Next Generation EU to implement the National Recovery and Resilience Plan (PNRR), which have made Italy a net recipient, meaning a member state that now receives credits exceeding its payments.

Financial Flows within the EU

Every year, the European Union needs to finance its activities to achieve fundamental objectives and political priorities.
Besides receiving European resources, member states must also provide annual allocations to the EU.
Between 2014 and 2020, Italy had a negative balance of 37.9 billion euros, “losing out” only to France, the United Kingdom, and Germany.
However, from 2021 onwards, the funds allocated for the European post-pandemic recovery have reversed the situation.

Technically, according to the latest Annual Report on Financial Relations between Italy and the European Union by the Court of Auditors, Italy remains a net contributor when considering “ordinary” resource exchanges.
In 2022, Italy paid 16.7 billion euros to the EU (down 7.6% from 2021).
During the same year, Italy received 14.3 billion euros for various areas, including “cohesion, resilience, and values,” “natural resources and environment,” and “single market, innovation, and digital.” Thus, in 2022, Italy’s credits to the EU exceeded the EU’s payments to Italy, resulting in a net negative balance of almost 2.4 billion.

Impact of Next Generation EU Funds

Between 2016 and 2022, Italy paid a total of 116.2 billion euros to the EU, receiving 84.4 billion and ending up with a deficit of over 31.7 billion euros.
However, starting from 2021, the funds from the Next Generation EU, amounting to 10.1 billion for 2021 and 22.4 billion for 2022, need to be considered.
The result? Taking into account the PNRR funds, between 2016 and 2022, Italy no longer shows a deficit of 31.7 billion but instead, a positive net balance of 894.6 million euros.

EU Budget and Contributions

The EU’s overall financing is authorized by the annual budget, which includes expenses divided into commitments, covering legal obligations that may be incurred during the fiscal year, and payments, for expenses related to agreements signed in the current or previous years.
Each member state contributes through three main sources: Traditional Own Resources (TOR), derived from customs duties on imports from third countries collected by the member states on behalf of the EU, VAT-Based Resource, a contribution applied by each state on its VAT taxable amount, and GNI-Based Resource, proportionate to the gross national income of each member state.

The GNI-Based Resource is the primary one: in 2022, Italy paid 13.7 billion euros (a 10.6% decrease from 2021).
The TOR, showing significant growth, amounted to nearly 2.8 billion euros for Italy in 2022 (+49% from 2021).
Since 2021, states also make payments for a new item, the Own Resource on Plastic.
It involves a national contribution based on the amount of non-recycled plastic packaging waste to encourage member states to reduce them: Italy has paid 1.5 billion euros for this item in two years.