Steel, aluminium, cement: the UK’s new carbon tax hits imports in January. Who pays, and when?

The UK scheme follows the EU’s own CBAM, whose definitive phase started on 1 January 2026. But the two systems are not the same, which matters for anyone moving these goods between the UK and the EU. The rules are set out in the Finance Act 2026 and four sets of regulations, summarised in the government’s CBAM policy summary.

Which goods are covered

UK CBAM covers goods from five sectors: aluminium, cement, fertiliser, hydrogen, and iron and steel. What counts is the commodity code on the declaration, not what the product contains. Some scrap codes are excluded.

Glass and ceramics will not be in scope from 2027. Unlike the EU scheme, the UK one does not cover electricity. For now, only direct emissions count. Indirect emissions, for example from the electricity used in production, will be added in 2029 at the earliest.

Who pays: the name on the declaration

This is the key point for logistics companies. According to HMRC guidance, the importer liable for CBAM is the person named as the importer on the customs declaration, even if someone else makes the declaration. The importer can also be based outside the UK.

HMRC explicitly lists freight forwarders, hauliers, customs brokers and express operators as intermediaries who may import goods on someone else’s behalf, and says the customer remains the importer. However, HMRC’s guidance does not say whether indirect representatives could share liability, as they can for customs debt. Brokers acting as indirect representatives should clarify this before January.

How much and when

The CBAM bill is calculated as the embodied emissions of the goods (in tonnes of CO₂e) multiplied by a CBAM rate for each sector. The rate is based on the average UK ETS auction price for the quarter, adjusted to reflect free allowances given to UK producers. HM Treasury will publish rates every quarter from January 2027.

Importers can use actual emissions data verified by an accredited independent verifier, or default values set by the government. If a carbon price has already been paid abroad, it can be deducted through Carbon Price Relief.

The timeline:

• 1 January 2027: liability starts for goods imported from this date,
• 1 January 2028: registration opens, with a deadline of 31 January 2028 for the first year,
• 31 May 2028: first return and payment, covering all of 2027,
• from 2028, returns are filed quarterly.

The 2027 data trap

The long gap between the start of liability and the first payment is where problems can start. Importers will need a full year of import data, and much of it comes from the declarations prepared by brokers and forwarders.

For each import, HMRC requires records of the 8-digit commodity code, the tax point date, the value, the net mass in kilograms excluding packaging and proof of origin, plus any verification reports. Records must be kept for six years, and failing to keep them can lead to a £500 penalty. The importer is responsible for the accuracy of the weight, even if it comes from a supplier.

That means mistakes on a declaration, such as a wrong commodity code or weight, can flow directly into a tax bill.

Two CBAMs, one lorry

For goods moving between the UK and the EU, the differences matter:

• the UK threshold is based on value (£50,000), while the EU one is based on mass (50 tonnes a year),
• the EU scheme works with CBAM certificates, which go on sale in February 2027, while the UK collects the tax through returns,
• the EU covers electricity, the UK does not.

In May 2025, the UK and the EU agreed to work towards linking their emissions trading systems, which could lead to exemptions from each other’s CBAM. As we reported in our coverage of the UK–EU deal, it was one of the summit’s key commitments. Negotiations are ongoing, but HMRC says no country is currently exempt.

What logistics companies should do now

• Identify customers importing CBAM goods and check who is named as the importer on their declarations.
• Make sure commodity codes and net weights excluding packaging are recorded accurately from 1 January.
• Agree with customers how declaration data will be shared for their 2027 return.
• If you act as an indirect representative, ask HMRC or your advisers about potential liability.

CBAM may be a tax on importers, but the data it relies on starts in the logistics chain. Companies that prepare now can turn that into a service their customers will value.