Australia labels the European Union’s push for a carbon border tax ‘protectionist’

The federal authorities has hit out on the European Union’s proposal to impose a carbon border tariff, calling it “protectionist,” regardless of assurances the measure is aimed toward levelling the taking part in subject on curbing emissions.

Commerce Minister Dan Tehan says the transfer, revealed on Wednesday evening, is a risk to Australian jobs and will threat not complying with world buying and selling guidelines. 

“Our main considerations are that we expect it’s protectionist,” Mr Tehan instructed the ABC.

“We expect it might be significantly better to incentivise nations to a take care of emissions discount, fairly than penalising them.” 

The Carbon Border Adjustment Mechanism was revealed as a part of a raft of draft local weather change measures aimed toward securing Europe’s path to carbon neutrality by 2050.


The carbon levy can be first imposed on EU-based companies that import cement, iron and metal, aluminium, fertilisers and electrical energy, however should nonetheless be accredited by 27 member states in the EU Parliament.

It’s designed to verify imports from abroad face the identical carbon worth, which might be imposed on items produced in Europe beneath the EU’s personal emissions buying and selling scheme.  

The EU has warned there’s a sturdy threat of “carbon leakage” undermining its efforts to drive down emissions via carbon-intensive industries shifting to nations with much less bold local weather insurance policies.

The coverage additionally intends to encourage nations outdoors the EU to undertake greener insurance policies that are not doing sufficient to deal with local weather change.


The levy is a part of what has been named the “Match for 55” package deal, which intends to scale back emissions by 55 per cent on 1990 ranges by the tip of the last decade.

It will be phased in with a reporting system to be applied from 2023 and nations required to pay prices from 2026 onwards. 

It is not clear how the carbon border tariffs would hit Australian exports, however Mr Tehan’s objections point out there may be concern over the potential influence.

“We’re extra more likely to see oblique prices than direct prices when it comes to Australian direct export of these merchandise into the EU. So we’ll proceed to evaluate all that,” Mr Tehan stated. 

Australia exported $11.7 billion price of products to EU nations within the 2019-20 monetary 12 months, together with main exports resembling coal, accounting for $2.7 billion. 

However the nation shouldn’t be listed within the high 10 exporters that might be worst impacted by sectors coated by the carbon border tariff, which embody China, Russia, Turkey and the UK.    


The European Union has insisted the measures will adjust to guidelines from the World Commerce Group.

President of the European Fee Ursula von der Leyen stated CO2 emissions needed to have a worth “that incentivised shoppers, producers and innovators to decide on the clear applied sciences”. 

“Change on this scale isn’t straightforward, even when it is necessary,” she stated.

“For that motive there are some who will say that we should always go slower, that we should always go decrease, that we should always do much less. However in the case of local weather change, doing much less or doing nothing actually means altering the whole lot.” 

President of the European Fee Ursula von der Leyen.

Getty Photos Europe

Mr Tehan stated Australia supposed to intently look at whether or not the carbon tariffs amounted to a breach of world buying and selling guidelines.

“We fear that it is centered extra about elevating income than actually lowering emissions themselves,” he stated. 

“It is expertise that’s going to supply the solutions to lowering emissions, not taxes.”

Opposition local weather and power spokesperson Chris Bowen stated the EU’s transfer locations stress on the Australian authorities over the ambition of its local weather change insurance policies. 

“I don’t need this tax to use to Australia,” he instructed reporters. 

“However beneath federal authorities coverage settings, it should apply to Australia as a result of our emissions discount ambition shouldn’t be sturdy sufficient.”

America, UK and Japan are additionally contemplating related carbon tariffs within the lead as much as the COP26 local weather convention in Glasgow on the finish of the 12 months.  


Australian Nationwide College affiliate professor Dr Christian Downie stated whereas the preliminary impacts of a European carbon border tariff could also be “modest”, this might enhance if different nations get on board.

“The actual threat is that if Japan, the US observe Europe’s lead, the influence on our export industries might mount up fairly rapidly,” he instructed SBS Information. 

“The federal government has didn’t put in place a plan to scale back emissions, so what we’re seeing now’s different nations set to impose carbon taxes on our export industries.”  

Prime Minister Scott Morrison has indicated Australia is dedicated to reaching web zero emissions as quickly as potential and ideally by 2050. 

However the Australian authorities has confronted worldwide stress to raise its emissions discount commitments, with each the US and UK rising the ambition of their local weather change targets this 12 months. 

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