EU suggestion on India’s carbon tax will not help local companies: GTRI
GTRI) Wednesday suggested India to use a twin strategy of a calibrated retaliation mechanism (CRM) to retaliate in equal measure and renaming some ongoing schemes as carbon taxes to deal with the EU’s climate taxes. It said that the EU’s suggestion that India could avoid its carbon tax by imposing a similar levy locally, will not help the domestic players much, as they would still be liable for the duty for their exports to the bloc.
ET Guide to ITR
Missed ITR deadline: These people won't pay penalty
How to file ITR after July 31 deadline?
What is the penalty for filing ITR after the July 31 deadline
The EU’s Carbon Border Adjustment Mechanism (CBAM) will translate into a 20-35% tax on select imports into the EU from January 1, 2026. From that date, EU importers will have to declare and purchase CBAM certificates to cover the emissions associated with producing imported steel products.
Recently, the EU proposed that India implement its own carbon tax to support greener supply chains while ensuring continued access to the bloc’s market.
Noting that the main issue is that carbon prices are usually based on a country’s economic situation and the EU can afford high carbon prices, it may not be sustainable for a developing country like India, it said that simply adding a local tax would not reduce the overall tax burden significantly.
On the CRM, it cited the example of New Delhi retaliating against the US’ imposition of import tariffs on India’s steel and aluminium in 2018. This retaliation involved precise
