On 30th October, the Government Response to consultation on the ‘introduction of a UK carbon border adjustment mechanism (CBAM)’ was published as part of the Autumn Budget 2024.
The Government Response confirms that a UK CBAM will be introduced on 1st January 2027. However, it will not apply to ceramic and glass products, as previously proposed, allowing the Government and industry time to address feasibility concerns raised throughout the consultation process. The Government declares it will continue to work with industry to address these concerns before considering their potential inclusion at a later date.
The UK CBAM to be introduced on 1st January 2027 will place a carbon price on goods that are at risk of carbon leakage imported to the UK from the aluminium, cement, fertiliser, hydrogen, iron and steel sectors. It aims to ensure that UK decarbonisation efforts lead to a true reduction in global emissions rather than simply displacing carbon emissions overseas.
The value of the minimum registration threshold will be increased from £10,000 to £50,000 so only businesses importing £50,000 or more of CBAM goods over a 12-month period will need to comply with the UK CBAM.
For more information, access the full Government Response.
