UK and US Upset About EU Carbon Tax

A statement by Commission President José Manuel Barroso that new climate change legislation may force exporters in countries with less stringent climate policies to buy EU pollution permits if they wish to trade in the EU has upset both the UK and US governments.
UK officials immediately responded to Barroso’s announcement saying they would argue against any move by the EU to impose a ‘carbon tax’ on imports from third countries.  This could include electricity imports.
The Commission President made it known publicly that unless an international deal on cutting greenhouse gas emissions after 2013 is reached, the EU should “require importers to obtain allowances alongside European competitors, as long as such a system is compatible with WTO requirements”.
“There would be no point in pushing EU companies to cut emissions if the only result is that production and indeed pollution shifts to countries with no carbon disciplines at all,” he said.
The idea of climate trade sanctions to fend off competition from countries with less stringent environmental laws, such as the United States and China is an idea that has received a great deal of support from the French government.
The US said it was “dismayed” at Mr Barroso’s discussion of carbon taxes for imports. US Trade Representative Susan Schwab stated: “We have been dismayed at a variety of suggestions where we see climate or the environment being used as an excuse to close markets.”