How Europe’s carbon border tax will change trade and climate policy

Published on January 23, 2026

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In a major shake-up of green trade rules, the European Union began charging a carbon-emissions tax on imported goods such as steel and cement at the beginning of this year. Here’s how and why this first-of-its-kind policy, known as a Carbon Border Adjustment Mechanism (CBAM), is already reshaping climate practices far beyond the EU. Switzerland's approach to the new tax has been cautious. The non-EU country is exempt from the CBAM but will reassess its position on this type of carbon tax scheme this year. Developing countries meanwhile have warned that the EU’s scheme is unfair. And while the CBAM is already having an effect, its long-term success will depend on whether it pushes other countries to adopt their own schemes for pricing carbon. What is the EU’s carbon border levy and how does it work? Initially, the tax applies to cement, iron, steel, aluminium, electricity and hydrogen that come into the EU at certain amounts. Reuters has reported that the EU plans to expand the tax ... Full story here Are you the author?

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