Full Report On EU Financing Of Ukraine Is Now Public

The Hungarian government has made public a report by the EU Affairs Minister, detailing Ukraine's financing and the EU's related expectations of Hungary.

Photo: Shutterstock/Mehaniq

Macro-Financial Assistance cannot be used for military financing. To date, no proposal has been adopted to resolve military financing. For the EU, the European Peace Facility is the natural channel for military funding, and a significant portion of the returns from frozen Russian assets has already been directed there. However, due to Hungary's veto, the legal basis for using these funds has so far remained disputed.

The document also shows that the so called “reparations loan” based on the direct use of frozen Russian assets has not been taken off the agenda. Supportive action by the European Parliament is expected in January 2026. It remains an open question whether this will be sufficient to move forward the process that has stalled in the Council.

It is also worth noting that the above mentioned MFF proposal for supporting Ukraine effectively treats the EU budget for the 2028–2034 budgetary cycle as a bottomless pit. Under the proposal, the approximately 100 billion euros earmarked for Ukraine could in the future be increased by several hundred billion euros through amendments to the Global Europe regulation under the ordinary legislative procedure, without requiring unanimity. According to the proposal, the European Commission would generate the necessary funds by cutting cohesion funds and agricultural subsidies by at least twenty percent.

All things considered, Ukraine’s likely actual and total share of the next MFF could exceed 360 billion euros under the draft.

Zelensky Submits the Bill 

Last Christmas, Ukrainian President Volodymyr Zelensky unveiled the Ukrainian prosperity plan, which sets out an 800 billion dollar demand over the next decade for Ukraine’s reconstruction and economic development, on top of military and defense spending. Hungary, of course, also rejects this request. Not without reason, as this amount, when calculated per capita for Hungary, would represent a burden of approximately 320,717 forints per person, or more than 1.3 million forints per family.

In summary, it can be stated that the European Union has so far

ensured Ukraine’s uninterrupted financial and military support through 193.3 billion euros in aid and the taking on of 90 billion euros in loans, placing a significant burden on the EU budget.

Beyond this, Ukraine is making an additional 800 billion dollar demand on the European Union, supplemented by the approximately 100 billion euros in funding foreseen for Ukraine in the EU’s budget proposal.

Due to Lack of Funds, Commission Would Shift the Burden Onto Member States – Demands from Hungary

The report also reveals that in order to create the necessary financial framework, Hungary would be expected to abolish subsidized home loans, the family housing support scheme, and exemptions from transaction duties, eliminate the 13th and 14th month pensions, and introduce private pension systems. In addition, Hungary would be required to dismantle the flat rate personal income tax system and introduce a so called progressive personal income tax. In its country report, the European Commission also criticized tax benefits for mothers, young people, and families, as well as the utility cost cuts that ensure low energy prices; proposed taxing government bond yields, closing hospitals, abolishing the workers' loan program, and eliminating support schemes for small and medium-sized enterprises. All this would be required in order to generate higher tax revenues and reallocate resources to support the war in Ukraine.

"Eight hundred billion dollars do not grow on trees. This is how much the Ukrainians demand from us Europeans over the next ten years. For Hungary, this would mean a tribute of more than nine billion dollars," Prime Minister Viktor Orban wrote wrote on his social media page.