The Minister of Finance published on Friday, 19 June 2020 the regulations for the trade exposure and greenhouse gas (GHG) emission intensity benchmark performance allowance, and the notice for the renewable energy premium, in terms of the Carbon Tax Act
The finalisation of the regulations concludes an extensive stakeholder consultation process on the carbon tax over the past decade. Going forward, the National Treasury will embark on a policy process to inform the second phase (from 1 Jan 2023) to assess the impact of the carbon tax in bringing down the absolute level of GHG emissions. The review will consider strengthening the rate of the carbon tax and adjustments of the tax-free allowances in line with the Paris Agreement requirements for carbon neutrality by 2050 and pursuing mitigation efforts to limit warming to well below 1,5 degrees Celsius.
The carbon tax is an integral part of Government’s package of policy measures to mitigate climate change as outlined in the National Climate Change Response Policy, National Development Plan and its Nationally Determined Contribution commitments under the 2015 Paris Agreement.
The gazetted Regulations and Notice together with a detailed summary of the stakeholder comments on the draft regulations and government responses are available on the National Treasury website (www.treasury.gov.za). In addition, the sector and subsector trade and production data, methodology for ensuring the compatibility of the data, and calculations of the trade exposure allowance for the different sectors and subsectors are also published for information purposes.