EU pressure carbon tax: Challenges with enterprise

VTV.vn – pressure mechanism, tax emissions for goods imported into the European union (EU) will have effect from the beginning of the following month. No little business in Vietnam will be affected.

EU implementation of the carbon tax with 6 product groups

Mechanism tax pressure emission allows the European union to unilaterally impose tax on imports from countries that do not meet environmental standards of the European union set out. However, in the first phase lasted for 3 years, not have to change anything big. The importer only have to declare the emissions related to 6 product groups. This is the group production process, create more emissions.

Cement, iron and steel, aluminum, fertilizer, power and hydrogen imported into the European union will have to purchase more quota emissions, if the production process generates emissions more than environmental standards of the European union set out. A measure primarily to protect European businesses still must comply with the stricter regulations on emissions, is also meant to be more costly and therefore products have higher price.

“Adjustment mechanism carbon motivate other countries to the climate. This is perhaps the only way to encourage the business outside of Europe reduce waste. They can export to the European, but must meet the same conditions as the conditions of the European business had to comply with in the last 15 years. Who cause pollution, people that have to pay. If you want to sell products to Europe, they must pay the difference contamination when crossing the border,” said Mohammed Chahim, senator, Dutch, rapporteur of the European parliament, said.

Business to export goods to the European union if you wish to avoid spending this, then the only way you can reduce the emissions in the production process in his country at par environmental standards of the European union, or buying certified emission. The 2 ways are increase costs and reduce profitability of the business. However in the first 3 years from the date of 1/10 coming, the new European only require businesses to draw up the declarations dissection emissions related to products. A way for enterprises to become familiar with the new rules.

“The first 3 years only is the stage of dissection, but behind this, that's the measure you must apply how to reduce the amount of carbon generated. Because if you don't minimize it with respect to each amount of goods you enter, you will have to pay taxes, the average is 75 Euro for 1 ton of emissions generated. That means if you do not cut, do not apply the measures clean and green to cut the amount of carbon, you'll pay tax and payment of this tax will push up the cost of goods of higher, is there even be higher than the goods produced in the European union,” said Tran Ngoc Quan, commercial counsellor Vietnam in the European union and the Kingdom of Belgium, or.

From the year 2026, these product groups will be subject to the carbon tax, in which iron and steel, aluminum is the raw material of Vietnam export into the European union. The European side is expected in the future will pressure the carbon tax up all the other items that use these products as raw materials.

Business directory yet understand about the impact of the carbon tax

According to The international energy average to make 1 ton of steel will be discharged to 1.85 tonnes of CO₂, i.e. make the 1 ton of steel, the new pay tax on emissions over 3.300.000 copper. However, if multiplied by the production of millions of tons of 1 year of a number of steel companies currently in Vietnam, that number was up to a thousand billion. The awareness and information of businesses in Vietnam on this topic is still very modest.

So, warning of the commercial counsellor at the European union, is not superfluous, which is the payment of this tax will push up the cost of goods of Vietnam is higher than the manufactured goods now in the European union.

Business new aluminum to spend 3 years of uninterrupted to finalize the regulations, export to Europe, because there are nearly 1/3 output of the business depends on this market. However, to date, the business still perplexed with the carbon tax, even if aluminum is 1 of 6 items will be subject to tax emissions.

“Carbon emissions with business is how to calculate and there are guidelines as to how to business initiative this preliminary for business to business I know is located in the come on, hiccup,” said Vu Van, Mature, secretary General of Association of aluminum Viet Nam, said.

A survey of Research and development in The private sector by the year 2022 shows that only 11% of businesses understand the requirements of CBAM. Also to 53% of business completely't know anything about this mechanism.

“The rules of the world hasn stage do not go straight into business as the current. It's very different than negotiations, commitments ago when we have a cycle of internal legislated, then the new impact to the business,” ms. Pham Thi Ngoc Thuy, director of the Office of Research and economic development private, for or.

However, according to representatives of the Ministry of natural resources and Environment, Vietnam also had roadmap own, require businesses to implement greenhouse gas inventory begins April this year, and this practice is also consistent with the route of the carbon tax in the EU.

“To 2025, we will have floor trading emissions greenhouse gas credits carbon and by the year 2028 will operate officially. From 2026 onwards, the base greenhouse gas emissions will be allocated ceiling emission certain,” said Nguyen Van Minh, Head of Economic and information on climate change, Department of climate change, Ministry of natural resources and Environment, information.

Even so, a number of comments for that, still not really have specific instructions from the ministries related to the business can ensure compliance with the inventory of carbon regulations.

Awareness and compliance with greenhouse gas inventory is the first step to business that can determine is his impact how from the carbon tax, but many businesses are still struggling now from this step. Important and costly than after determining the level of impact, businesses also have to plan to limit emissions, even as carbon neutral, from which new redefine the problem business and the interest of the business like. Business is only 3 years to restructuring, even as investment in new technology to accomplish that, before the EU official impose tax on emissions.

In parallel with the active adaptation of the business, the early building of market transactions, credits carbon in water with a mechanism to price carbon, respectively, will be an important basis for exports and the EU can be exempted CBAM or if the business can prove that the price of carbon has to be paid in the production process in Vietnam, the corresponding amount is deducted from the final bill, i.e. the amount of this money will stay in Vietnam instead of taxable in the EU. CBAM is a kick to race 0 of the corporate carbon emissions in the next few years will be hotter than ever.

Source: vtv.vn