European Union Considers Green Import Taxes
The European Union is currently considering proposals to levy import taxes on goods from countries that do not sign up to emissions treaties.
Taxes will likely be charged based on the equivalent price of an EU emissions permit for specific goods as a way of levelling the playing field between goods manufactured subject to emissions cap & trade regulations and goods from nations not imposing restrictions.
We are not completely sure that this is a workable idea.. Whilst easing some of the short term fears that business leaders within the EU have regarding competition from ‘dirty’ imports, the scheme is likely to achieve little else. We cannot imagine nations implementing emissions trading purely in response to the threat of import tariffs, and firms that rely on foreign imports will be hit. Meanwhile, import tariffs which are applicable in one region only are unlikely to encourage dirty industries to clean up their act.
The real objective of encouraging global competition in the development of green technologies will only be achieved when all industrial nations fully sign up to a global scheme. With the political process inching towards a conclusion following the moderate success at Bali in December it would make more sense to wait for the real deal, rather than implement messy trade tariff schemes. No doubt some of readers may have even stronger views?
Watch out for our piece on the Pro’s & Con’s of emissions cap & trade schemes later this week.
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