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CBI calls for carbon tax freeze

A FREEZE in taxes on carbon emissions could allow UK businesses to compete more effectively on an international level, according to the CBI.

The current regime which imposes a levy – known as the Carbon Price Floor – on greenhouse gas emissions aims to encourage investment in low-carbon energy generation also impedes competition and raises customers’ energy bills, the business group claims.

It adds the charge is higher than EU equivalents, again putting UK companies at a disadvantage.

“It’s vital that we have a robust carbon price across Europe if we are to obtain the investment in energy infrastructure that the UK needs,” CBI director-general John Cridland said.

“At the same time, we need to recognise that British businesses, especially energy-intensive industries, are struggling with high energy costs so we want to freeze the Carbon Price Floor to help firms compete internationally, as well as ease pressure on household bills.”

In a letter to George Osborne, Cridland also called on the chancellor to introduce a capital allowance to encourage infrastructure investment, freeze air passenger tax and do more to support SMEs. 

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