HMRC has recently published for technical consultation draft secondary legislation for the carbon border adjustment mechanism (CBAM). This includes some of the CBAM administrative requirements, including those on embodied emissions and the monitoring and verification of emissions data. The consultation is open for responses until 21 May 2026.
By way of reminder, the UK CBAM is a new tax which aims to ensure that highly traded carbon intensive goods imported into the UK face a comparable carbon price to that paid by manufacturers producing the same goods in the UK. Currently, UK manufacturers are subject to carbon pricing for direct emissions under the UK Emissions Trading Scheme.
The UK’s CBAM is due to commence from 1 January 2027 and will apply to goods from the following industrial sectors:
- aluminium,
- cement,
- fertiliser,
- hydrogen, and
- iron and steel.
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