The new tax is planned to be introduced on carbon-intensive imports, in particular iron and steel.
Ukraine may experience a serious economic blow in 2026, when the SVAM environmental tax is implemented in the European Union. But Kyiv still has a chance to delay its introduction if it takes urgent steps. This is stated in a Politico article titled The EU’s carbon tax could bankrupt the country it’s trying to save, Ukraine.
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It has been suggested that the European Union continues to push for a new law, which in its current form could devastate the war-torn Ukrainian economy. We are talking about a tax that the EU plans to introduce in 2026 on a range of carbon-intensive imports, in particular iron and steel. Ukraine’s losses could reach $1.4 billion per year.
“However, the CBAM law has a clause on force majeure – or natural disasters – for exceptional circumstances, and war and conflict fall under this category. But Brussels has not given a clear signal to -it will offer Kiev an exception from the mechanism,” – wrote Politico.
According to experts interviewed by the publication, if a carbon tax in the EU takes effect today, it will lead to a decrease in Ukrainian exports of 1.4 million tons of pig iron, which is equivalent to a loss of $600 million. – finished products will fall by 1.3 million tons, amounting to $640 million in lost revenue.
“Ukraine is going to its knees,” warned József Ksapo, director of technology and strategy at ArcelorMittal Krivoy Rog, Ukraine’s largest steel plant.
“The EU, of course, is not interested in destroying the Ukrainian economy, quite the contrary. Partly because of this, the CBAM rules contain a force majeure clause, which allows the EU to make exceptions. Mohamed Shahim, a MEP from the Netherlands who leads the work of the relevant parliamentary committee, said that the negotiators consider this formulation as a “Ukrainian case,” the publication points out.
However, the European Parliament cannot adopt this standard on its own – this step must be taken by the EU executive branch in Brussels – the European Commission. He has not done it yet, although there is still time, because the mechanism will start working in 2026. At the same time, you have to remember that such steps do not happen quickly. Integrating EU laws into national law is a long process, and the war makes the situation difficult.
Sagatom Saha, a fellow at Columbia University’s Center for Global Energy Policy, is surprised that the carbon tax situation is not seen as an urgent issue. He warned that with EU elections approaching, the issue could be delayed for several months while key EU institutions change personnel and lawmakers,” warned Politico.
Earlier, Ukraine named the conditions for limiting food exports to the EU. Kyiv is willing to accept such trade restrictions to ease political tensions with Poland.
Source: korrespondent
I’m Liza Grey, an experienced news writer and author at the Buna Times. I specialize in writing about economic issues, with a focus on uncovering stories that have a positive impact on society. With over seven years of experience in the news industry, I am highly knowledgeable about current events and the ways in which they affect our daily lives.