MEPs voted this week to exempt more than 90% of small-and-medium enterprises (SMEs) from the EU’s carbon border adjustment mechanism (CBAM) — a tax imposed on imports — amid European Parliament plans to simplify existing sustainability laws.
The CBAM is an import duty based on the estimated carbon footprint of certain goods like steel and cement, which has been in force in a transitional phase since October 2023. As of 2026, importers will be liable to report on the carbon footprint of their goods, and where applicable pay duty.
