Carbon Border Charge on Imports Not a Tax, EU’s Gentiloni Says

The European Union’s proposed levy on the carbon content of certain imported products isn’t a tax, the bloc’s top economy official said Thursday.

The Carbon Border Adjustment Mechanism (CBAM) is “not a tax, not a tariff,” but an “environmental policy tool that will equalize the price of carbon,” EU Economy Commissioner Paolo Gentiloni said at a briefing in Brussels.

• The definition of CBAM is a sensitive one, because the EU wants to avoid conflict at the World Trade Organization and with its own member countries—a danger if the measure is considered either a tax or discriminatory tariff. CBAM ...