The European Union has proposed a budget of close to €2 trillion ($2.3 trillion) for its next seven-year period, as it seeks to fend off a range of challenges from rising global economic competition to increased defense demands.

The European Commission on Wednesday proposed to tax companies with a net turnover exceeding 100 million euros ($116 million), one of five new revenue streams aimed at generating 58.5 billion euros annually for the European Union's next seven-year budget.

The European Commission is proposing a record 2-trillion-euro budget for 2028-2034, boosting funds for Ukraine, defense, and foreign policy. But tough negotiations lie ahead as richer EU states balk at higher spending.