The UK is hoping to win an exemption from a new EU tax on the energy used to produce goods, amid fears of higher bills and a hit to businesses, jobs and growth in the UK.

The EU’s new carbon border tax (CBAM) is being introduced from 1 January, meaning British businesses will be hit by levies on exports to the continent which are produced using carbon-intensive methods.

Industry is warning this will push up consumer bills and hit UK exporters, jobs and growth – derailing Rachel Reeves’s growth plans – and could also lead to dumping of carbon-intensive products, like Chinese steel, on the UK market.

Energy UK has warned it could leave British exporters facing a bill of up to £800m in carbon tax payments to the EU.

The tax is designed to encourage greener production, and level the pl

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