Will carbon taxes increase EU's cost of imports?

The US management consulting firm Boston Consulting Group has announced that in 2026, along with the Carbon Border Adjustment Mechanism (CBAM), EU’s carbon tax will be implemented.

European steel importers will face additional costs of about €2 billion per year. The EU's carbon price was expected to increase by €100 per ton. The costs will depend on the carbon efficiency of each manufacturer.

BCG foresees that by 2032, the cost of steel imported from the US and UK to the EU will increase by 6%. Import costs from other countries will increase by 10% for Turkey, 12% for South Korea, 17% for China and 32% for India respectively.

Inflation pressures are said to increase as the CBAM covers more goods.