UK failure to seal EU tax exemption hands industry mountain of paperwork

"UK manufacturers are to be hit with mountains of Brexit-style paperwork in January on 7bn worth of exports to the EU after the government failed to secure an expected exemption from new green taxes. The UK had hoped to secure a carve-out by Christmas on the carbon border adjustment mechanism (CBAM), but EU commissioners have confirmed this is not going to happen."

"UK Steel says the exemption is unlikely to be in place before Easter, resulting in new detailed paperwork for exporters, in a repeat of Brexit when they were hit with new paperwork on customs and standards of their goods. The new documentation requires exporters to provide a detailed paper trail of carbon emissions generated during the manufacturing process. It will apply to scores of products made with steel and aluminium, including washing machines and car parts, under plans Brussels unveiled on Wednesday."

"It will also apply to fertiliser, cement and energy exports. While the UK privately expressed hopes of a deal before Christmas, industry insiders say it was a case of ambition that was never in the realms of political reality. The EU only signed off the mandate on negotiations in early December, making any deal outside a high-level political agreement involving all 27 member states, some of which have little interest in the UK, impossible."

UK manufacturers will face extensive carbon border adjustment mechanism (CBAM) paperwork from January covering £7bn of exports after the government failed to secure an exemption. The paperwork demands a detailed paper trail of carbon emissions generated during manufacturing and will apply to numerous steel- and aluminium-made products such as washing machines and car parts, plus fertiliser, cement and energy exports. The EU only signed negotiation mandates in early December, making a pre-Christmas deal politically unfeasible, and UK Steel warns an exemption is unlikely before Easter. Businesses are advised to prepare for CBAM in force from January with government support available.

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