Action 3: Citizen's Dividend on Local Consumption

A New Economic Policy Instrument to Strengthen Europe's Single Market


Citizen's Dividend on Local Consumption

The future of the European Union relies more and more on how efficiently it is able to direct economic financial flows back to its own region – especially through the everyday consumption of citizens. The current situation, in which a significant share of private consumption is focused on goods produced outside the EU, will lead to job losses, tax base erosion and a weakening of strategic self-sufficiency in the long term.


We need a way to make it directly profitable for citizens to support European production. This is the response to the Citizen's Dividend from Local Consumption – a new proposed return mechanism that brings tangible financial benefits from European purchases.


How does the model work?

The citizens' dividend is based on the idea that the purchase of products and services manufactured in the EU creates social value, the return of which to the individual strengthens the European market. 


Here's how the model works:

  1. The system is managed by the tax administration of the Member State or the EU's common digital platform
  2. A consumer buys an EU-origin certified product or service
  3. An identified purchase is logged into the taxpayer's account via a digital receipt, bank data or mobile app
  4. The consumer receives a refund, for example:

  • Deduction for annual taxation (e.g. 3–5% of purchases)

  • Direct cashback to a digital wallet

  • Points to get discounts on public services or other EU-compatible goods


Objectives
1.          Redirect private consumption to the EU's single market
2.          Make local consumption economically viable for citizens
3.          Strengthen the competitiveness of SMEs and responsible producers
4.          Increase consumer data and transparency on origin and sustainability

 

Funding and impact

The model can be financed, for example, by part of the accumulation of CSAD duties or by reallocation of national VAT revenues. Example:

1.          If a consumer spends €5,000 per year on EU-origin products, → a 5% refund → €250 citizen's dividend

2.          At the EU-wide level, this could activate hundreds of billions of euros of European demand every year

 

Strategic benefits

  1. Improving the relative competitiveness of EU products

  2. Consumer behaviour steering changes from reactive to active

  3. Localisation of production gets a boost on market terms

  4. Tax revenues will strengthen in the long term through better employment rates

  5. Citizens have a direct economic link to the well-being of the internal market

 

Recommendation next:

1.          Launch a pilot in three countries: Finland, Germany, Portugal

2.          Initially targeted at three sectors: food, household appliances, clothing

3.          Build an EU-level digital identification and return platform (DIREC – Digital Reward for European Consumption)

 

The citizens' dividend from local consumption is not just a political signal, but a practical, feasible model that combines the interests of the individual with a common European future. It is a step towards an economic system where everyday choices build strategic competitiveness – one product at a time.


Written by: EU RENEW - Redirecting European consumption - Ways to strengthen economic self-sufficiency
Location: Berliini, Saksa

Popular posts from this blog

Action 1: EU Origin Preferential Scheme

Image
Strengthening the Single Market by Guiding Consumer Behaviour In the mid-2020s, the European Union will face a strategic challenge: production and consumption will move outside Europe at an accelerating pace, especially to China and other low-cost countries. Although this is a rational decision for the consumer – buying the cheapest possible – it causes job losses, erosion of the tax base and weakening of the sustainability of the internal market in the EU. The current structures are not sufficient to steer consumer behaviour towards more sustainable choices that are strategically important for Europe. New thinking is needed. To this end, we propose the creation of an EU Origin preferential system. This would be a common European mechanism for the identification and incentive, the aim of which would be to make consumer products produced in Europe more economically, emotionally and practically more attractive to the consumer – without violating competition rules or WTO obligations. The ...
Read more

Action 4: "Your Euro, Your Job"

Image
A European consumer brand that turns money into a political act The economic future of the European Union is not only built on export-driven industry or regulatory capacity. It is built on the daily shopping basket of every European citizen – the choices they make when buying clothes, household appliances or services. In this field of choices, the EU is not currently present as a visible or emotional actor. The consumer acts rationally: he/she buys the cheapest, fastest or most familiar product, regardless of the origin of the product or its social impact. This is economically understandable, but strategically unsustainable. "Your Euro, Your Job" is a proposal for an EU-level brand campaign that does not aim to steer consumption with regulations, but with emotion and awareness. Its core message is simple but impressive: every euro spent either builds your community or breaks it down. The campaign makes it visible that money is never neutral – every purchase has a direction,...
Read more