The new plan including iron, ceramics and cement producers and aims to stop foreign firms undercutting UK companies with higher eco-standards
Imported raw materials including steel and cement will incur a new carbon tax from 2027 under new UK plans designed to support domestic producers and reduce emissions.
The government said the tax would help address the phenomenon of “carbon leakage” where UK manufacturers are undercut on price by foreign rivals whose governments do not impose levies on businesses that emit a lot of carbon.
The result is that emissions are simply displaced to other countries, while UK producers lose out because they have to pay carbon-related charges.
The Chancellor Jeremy Hunt said the UK would implement a new import carbon pricing mechanism by 2027 to support the country’s drive to decarbonistion.
Imports of iron, steel, aluminium, ceramics and cement from overseas will face a “comparable carbon price” to those goods produced in the UK.
Mr Hunt said: “This levy will make sure carbon intensive products from overseas – like steel and ceramics – face a comparable carbon price to those produced in the UK, so that our decarbonisation efforts translate into reductions in global emissions.
Goods imported into the UK from countries with a lower or no carbon price will have to pay the levy by 2027, ensuring products from overseas face a comparable carbon price to those produced in the UK.
