EU Mulling Exempting 80% of Companies From Carbon Tariff, Official Says
The European Commission is considering exempting more than 80% of companies that otherwise would be subject to import tariffs under the bloc’s upcoming Carbon Border Adjustment Mechanism, Climate Commissioner Wopke Hoekstra said this week. Hoekstra said the EU has found that the law may disproportionately target companies that aren’t responsible for most carbon emissions.
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“If you look into all the companies that now have to deal with CBAM, you will find that roughly 20%, actually even less, are responsible for 97% of all the emissions,” Hoekstra said during a EU Parliament hearing Feb, 6. “So would it then not be smart to leave that roughly 80% off the hook in terms of the administrative burden?
“In my view,” he said, “it would.”
Hoekstra said any exemption would need to be “carefully calibrated” so the EU doesn’t “let people off the hook who might actually move into the 20%” of major carbon emitters. “But the current system or our current thinking -- where you actually apply a huge burden on companies who then fill out a lot of paperwork and have a lot of things to do, without any merit -- that cannot be the solution,” he said. “So there, we need to be a bit more street smart.”
The CBAM will require traders to pay taxes by 2026 on carbon emissions associated with certain imports (see 2310020037 and 2410170036).