EU makes breakthrough on climate-protection import tax

The European Union moved closer on Tuesday to pushing through an unprecedented tax on foreign companies that want to import products that do not meet climate-protection standards that EU companies have to comply with.

The breakthrough between the EU parliament and the 27 member states still stopped short of a full deal, but brought the implementation of the system within striking distance. Because some aspects of the tax, known as the Carbon Border Adjustment Mechanism, are tied up in other dossiers, a full decision on the tax can only be completed at a later date.

The tax will seek to create a competitive level playing field after EU companies complained that they had to incur high costs to meet climate targets while international competitors could simply import their goods without such constraints and price local producers out of the market.

“This will ensure a balanced treatment of such imports and is designed to encourage our partners in the world to join the EU’s climate efforts,” said Czech Industry Minister Jozef Síkela.

“Only countries with the same climate ambition as the EU will be able to export to the EU” without being hit by the tax, the EU parliament said in a statement. “The new rules will therefore ensure that EU and global climate efforts are not undermined by production being relocated from the EU to countries with less ambitious policies.”