Question to the HM Treasury:

To ask His Majesty's Government what plans they have to align the UK's carbon border tax with the EU's mechanism to ensure that the UK steel industry is not adversely affected by the delayed implementation.

A Carbon Border Adjustment Mechanism (CBAM) is a novel mechanism yet to be fully implemented anywhere in the world.

Implementation of the UK CBAM by 2027 will allow government to consult fully with those affected throughout the design and implementation phases. It will also give those affected in the UK and overseas more time to prepare for the changes and put appropriate processes in place with their supply chains to enable them to comply.

The effective EU CBAM charge will be introduced gradually from 2026 to 2034 to match their phase out of free allowances for sectors covered by the CBAM, including iron & steel. In 2026, only a relatively small amount of the emissions embodied in CBAM goods will face the EU CBAM charge when they are imported to the EU.