Carbon tax on imports

12 June 2023 | Carbon Emissions

Introduction

The Member States of the European Union have established a mechanism of carbon adjustment at the borders. The carbon tax is presented like a tool to fight against global warming. This tax aims at the imports of some activity sectors depending on the emissions linked to their production.

What’s the carbon tax

The carbon tax is a direct environmental tax, which is proportional to the quantity of emitted CO2 during the production and the use of a resource, a good or a service. It takes the form of a fee per ton of CO2 emitted, with a program of progressive increases. The objective of these increases is to promote long-term investments to reduce emissions. Without excessively penalizing companies in the short-term.

The objective of the carbon tax is to struggle against global warming by reducing the CO2 emissions. It aims to financially punish the emitted emissions by companies, on the “polluter-pays” principle. Thus, it promotes companies to adopt more virtuous practices in their activity sectors.

The carbon tax in France

In France, the carbon tax was decided in 2014 on fossil energies (polluting fossil fuel: oil, natural gas and coal). It allows taxing all the activities that emit CO2 through the use of fossil energies.

The amount of the tax is changing, it progressively evolved these last few years. It increased from 7€ per ton of CO2 in 2014 to 44.60€ per ton of CO2 in 2022.

In France, greening of the energy fiscality has the objective to contribute to the reduction of the oil dependence and to promote the increasing of the energetic efficiency of houses and companies.

A carbon tax on imports in the EU

The European Union adopts a carbon tax at the borders by 2027. Importers should by October 2023, declare the quantity of emissions contained on their imports.

The mechanism concerns, at first, activity sectors the most carbonated: iron, steel, cement, fertilizer, aluminum, electricity and hydrogen. It will also expand to indirect emissions that are linked to the process of production.

By October 2023, the carbon tax at the borders will start by a test phase. A phase during which importers should declare the carbon emissions of their imported products but won’t pay. At the end of this test phase, the Member States could act on other activity sectors, like the agricultural goods.

The law put in place will promote then the countries non-members of the European Union to develop/increase their climate ambition. Only countries having the same climate objective as the European Union would export to the EU without need to buy a CBAM certificate (Carbon Border Adjustment Mechanism).

Objectives of the carbon tax

The carbon tax is introduced like a tool to fight against global warming. The EU hopes so that the carbon tax will prevent the relocation of CO2 emitting companies. Which face to the environmental regulations of the carbon market, will be tempted to move towards less restrictive standards. By this fact, the EU can avoid the import of goods of which the production promotes global warming.

They also want to impose environmental norms of Europe to foreign companies. In order to promote the other countries to reduce their CO2 emissions. Finally, the carbon tax could allow the EU to make money and finance other projects.

Digital carbon tax?

But so, what about digital? The French Parliament has promulgated the REEN law the 15th of November 2021, aiming to reduce the digital environmental footprint in France. This law aims to empower all digital actors. Indeed, digital generates a growing pollution which already represents more than 6% of global CO2 emissions.

If nowadays these emissions aren’t integrated into the mechanism of carbon tax at the borders, we think that it’s just a matter of time. When the approach will be integrated to carbon balances of companies, so this element could be a factor of competitiveness.

But what actions are made to reduce the digital carbon emissions of companies? You can find tips on sustainable IT, or the reduction of the carbon footprint of emails in our articles before. Greenoco can also help you reduce your digital carbon emissions.

Greenoco to reduce the carbon emissions of websites

In Greenoco, we have developed a tool allowing to calculate and reduce the carbon emissions of websites. Without changing the structure or the content of your website, you can reduce the carbon footprint of your website, from 10 to 70%. You can also increase the performances of your website and reduce the host cost.

Digital consumes more than 10% of the global electricity. By reducing the carbon emissions of your website and by increasing your structure, you reduce these electric consumptions, but also the materials obsolescence.

Conclusion

The carbon tax on imports is an innovation of the EU, very engaged in the objectives of CO2 emissions reduction. To support industrials to put in place and reach these objectives all around the world, the carbon tax on imports is an important move towards. It allows to avoid the relocation of industrial activities on the other side of the globe, generating more transportation, and so more pollution. We’re coming back to shorter circuits.

In Greenoco, we have for objective to reduce the carbon impact of websites. But also to reduce the carbon emissions related to the use of the internet, in a way to develop a more virtuous internet. By putting in place all the realizable actions, we could hope to slow the CO2 emissions, and so global warming.

You want to discover the carbon footprint of your website and reduce them? Contact-us! Or create an account to test the platform Greenoco.

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