M

Member

Speaking in the House of Lords on 28 January 2026

Debate

Greenhouse Gas Emissions Trading Scheme (Amendment) Order 2026

Contribution

Free allowances have been the mechanism that we use to protect businesses, such as cement and steel, from being undercut by cheaper imported products from countries that do not charge carbon taxes. That has meant that those businesses have not faced higher costs from the tax, and therefore neither have consumers. Because of the CBAM, the protection is being moved to a tariff placed on imports at the border, which means that the free allowances in the domestic UK market are being phased out. We should be clear that that means that the carbon tax will now start to be charged on the production of goods produced for the British market that otherwise had been protected by free allowances and British consumers will face higher prices as a result.

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