Draft Carbon Fee Rates Announced by MOENV

The Ministry of Environment (MOENV) has released the draft carbon fee rates following the 6th meeting of the Carbon Fee Rate Review Committee held on the 7th of this month. The committee confirmed that the deliberation process took into account various factors, including Taiwan's current greenhouse gas (GHG) reduction progress, types of emission sources, GHG categories, emission volumes, voluntary reduction efforts, reduction effectiveness, and the potential impacts of different fee rates on the overall economy (GDP), consumer price index (CPI), and specific industries.

After thorough discussions, the majority of the committee members proposed the following draft rates: a general rate of NT$300 per ton of CO2e, a preferential rate B of NT$100 per ton of CO2e for those meeting designated technical benchmark targets, and a further reduced preferential rate A of NT$50 per ton of CO2e for industries adopting the highest international carbon reduction standards.

MOENV clarified that the general rate would start at NT$300 per ton of CO2e under a gradual approach. For preferential rate B, the committee referenced Japan's carbon tax (approximately NT$64.7 per ton of CO2e) and Singapore’s (NT$116.5 per ton of CO2e), and considered industry impact assessments, aiming to limit the effect on gross profit margins to no more than 10%. As a result, the proposed starting rate for preferential rate B is NT$100 per ton of CO2e. For industries adopting the highest international carbon reduction standards, which achieve approximately twice the reduction of the technical benchmark targets, the committee suggested a preferential rate A of NT$50 per ton of CO2e.

The committee also noted that additional rate suggestions proposed during the meeting would be considered during the 2025 review of the 2026 rates, taking into account the progress of voluntary reduction projects and reduction plans.