The UK Carbon Border Adjustment Mechanism (CBAM) is a new tax designed to put a carbon price on certain emission-intensive goods imported into the UK. It starts on 01 January 2027 and covers specified products in the fertiliser, aluminium, cement, hydrogen, iron and steel sectors. Its purpose is to ensure that imported goods face a carbon cost comparable with that borne by UK manufacturers, reducing the risk that production and emissions simply move overseas.

HMRC has published fertiliser-specific standard carbon emission values, expressed as tonnes of carbon dioxide equivalent (tCO₂e) per tonne of product. For example, ammonium nitrate has a standard omission value of 2.6 tCO₂e. These values must be used where verified actual emissions are not reported. HMRC has also published an illustrative fertiliser CBAM rate of £1.45 per tCO₂e, calculated using current information, including the July–September 2026 average UK Emissions Trading Scheme price. This is not the final rate. The first actual rate, covering imports from 01 January to 31 March 2027, is due to be published before the end of 2026. Rates will then be updated quarterly.

HMRC has produced some summary guidance on CBAM and its implications for UK businesses.