Policy measures to respond to carbon fee impacts on industry in Taiwan

This study assesses the relevance of various jurisdictions’ CPI implementation experiences for designing Taiwan’s carbon fee in terms of i) the similarity of the economic structure of other jurisdictions to that of |Taiwan; ii) the similarity of the planned design of the Taiwan carbon fee to the instrument that these jurisdictions are implementing or planning to implement; and iii) the prominence. [...] The CPF started at £9 (US$11.1) per tCO2e in 2013 and increased to £18 (US$22.2) where it has been frozen since the Spring Budget 2015.16 It has two components: the price for ETS allowances and the CPS rates.17 If the allowance price is below the CPF, then the difference becomes the CPS rate and covered entities must pay both the allowance and the CPS prices so that the total carbon price is equiv. [...] If the allowance price is above the CPF rate, then the CPS rate equals the CPF rate, and regulated entities pay both the allowance price and the CPS rate, so that the total carbon price paid is the sum of the allowance price and CPF target rate. [...] The next section focuses on this issue by first characterising the different measures available to governments in theory, and then by describing the measures adopted by the governments of the EU, Singapore and the UK in practice. [...] If the importers can prove that a carbon price under a domestic compliance ETS or carbon tax has been paid in the jurisdiction of origin of the imported good, the corresponding nominal amount will be deducted from the obligation to be paid to acquire CBAM certificates.45 In other words, CBAM is intended to replicate the carbon price signal in the EU ETS for non-EU producers that export to the EU.