MSE consults on proposed increase in carbon tax and option to use eligible international carbon credits in draft Carbon Pricing (Amendment) Bill
22 July 2022
The Ministry of Sustainability and the Environment (“MSE”) is carrying out a public consultation on a draft Carbon Pricing (Amendment) Bill. The consultation closes on 5 August 2022.
The draft Carbon Pricing (Amendment) Bill will give effect to the revised post-2023 carbon tax regime as announced by the Government in the Budget Statement 2022. To support the move towards Singapore’s new climate ambition to achieve net zero emissions by or around mid-century, the Government announced that:
- the carbon tax will be raised from the current S$5/tCO2e to S$25/tCO2e for 2024 and 2025, and S$45/tCO2e for 2026 and 2027;
- a transition framework will be introduced to give eligible companies in emissions-intensive trade-exposed (“EITE”) sectors more time to adjust to a low-carbon economy. Examples of EITE sectors include the energy, chemicals and electronics sectors. Non-EITE sectors include domestic-oriented sectors like power generation companies, waste management companies, etc.; and
- companies will have the option to use eligible international carbon credits in lieu of paying carbon tax for up to 5% of their taxable emissions from 2024 onwards.
The following materials are available on the REACH website www.reach.gov.sg: