Penalties will start in 2012 at 20 euros ($28.80; £14.35) per gram of carbon dioxide over a target, and will grow to 95 euros in 2015.
Commission President Jose Manuel Barroso said the EU was "committed" to being a world leader in cutting CO2.
However, Germany's BMW and France's Peugeot criticised the move.
BMW said the proposals were "naive" steps that would distort the market in favour of makers of smaller cars.
Peugeot said: "These plans are anti-ecological, anti-social, anti-economical and anti-competitive in relation to non-European Union carmakers."