The government is consulting until 12 July 2019 on the UK’s approach to carbon pricing after withdrawal from the EU, covering the preferred option of a UK equivalent linked to the EU emissions trading system (EU ETS), together with other alternatives including a carbon emissions tax.
This consultation is run jointly by BEIS, the Scottish government, Welsh government and Department of Agriculture, Environment and Rural Affairs in Northern Ireland, to consider options for a regime to enable the government to continue to meet its carbon reduction targets after the UK leaves the EU.
The preferred option of the UK government and the devolved administrations is for cooperation with the EU to establish a UK national greenhouse gas emissions trading system (UK ETS) linked to the EU ETS.
However, alternative carbon pricing options considered by this document include:
a standalone domestic emissions trading system;
a new ‘carbon emissions tax’ as described in HMRC’s technical note first published at Budget 2018; or
participating in the next phase (phase IV) of the EU ETS, which the UK is currently obliged to transpose into domestic law before 9 October 2019.
While this consultation does not cover a carbon emissions tax in detail, it includes questions relevant to this option and the responses may be taken into account in developing policy for any tax on carbon.
Chapter 1 of the document focuses on proposals for the design of a linked or standalone UK ETS, to match the scope of the EU ETS both in respect of sectors and greenhouse gases covered, with possible expansion of the scope in later years;
Chapter 2 sets out proposals for the operation of a UK ETS, with the process of auctioning allowances in a linked system remaining the same as it is now;
Chapter 3 covers aspects applying specifically to the aviation sector, which might include postponing the first UK ETS annual compliance deadline for aircraft operators by at least one year; and
Chapter 4 covers the scenario in which the UK remains part of phase IV of the EU ETS past 2020.
The government is consulting until 12 July 2019 on the UK’s approach to carbon pricing after withdrawal from the EU, covering the preferred option of a UK equivalent linked to the EU emissions trading system (EU ETS), together with other alternatives including a carbon emissions tax.
This consultation is run jointly by BEIS, the Scottish government, Welsh government and Department of Agriculture, Environment and Rural Affairs in Northern Ireland, to consider options for a regime to enable the government to continue to meet its carbon reduction targets after the UK leaves the EU.
The preferred option of the UK government and the devolved administrations is for cooperation with the EU to establish a UK national greenhouse gas emissions trading system (UK ETS) linked to the EU ETS.
However, alternative carbon pricing options considered by this document include:
a standalone domestic emissions trading system;
a new ‘carbon emissions tax’ as described in HMRC’s technical note first published at Budget 2018; or
participating in the next phase (phase IV) of the EU ETS, which the UK is currently obliged to transpose into domestic law before 9 October 2019.
While this consultation does not cover a carbon emissions tax in detail, it includes questions relevant to this option and the responses may be taken into account in developing policy for any tax on carbon.
Chapter 1 of the document focuses on proposals for the design of a linked or standalone UK ETS, to match the scope of the EU ETS both in respect of sectors and greenhouse gases covered, with possible expansion of the scope in later years;
Chapter 2 sets out proposals for the operation of a UK ETS, with the process of auctioning allowances in a linked system remaining the same as it is now;
Chapter 3 covers aspects applying specifically to the aviation sector, which might include postponing the first UK ETS annual compliance deadline for aircraft operators by at least one year; and
Chapter 4 covers the scenario in which the UK remains part of phase IV of the EU ETS past 2020.
