Taxing ! ... You Will Pay £1,000's In A New Carbon Tax

So let’s imagine you are in charge of the UK Government and it is your role to act responsibly and in so doing ensure the country is prosperous and people are looked after.

That would be fine, except you also have a responsibility for the environment.

You are told by scientists that we must stop the temperature rising by more than 1.5 degrees, however, the problem is that temperatures are already at 1.1 degrees hotter.

You are told that the problem is the amount of carbon emissions and these must be reduced.

You are told that UK smaller businesses ie businesses with less than 50 employees, represent 99.5% of all of the 5.8 million UK businesses are responsible for around 50% of all business emissions and around 30% of all carbon emissions.

Accepting that you as the UK government have this big responsibility, you make a legal commitment to reduce the country’s carbon emissions to ZERO by 2050.

All good so far … but now the wheels start to fall off the wagon.


The UK Govt admitted that its climate change policy was unlawful in the high court (October 2022) and must now resubmit new proposals.


The Bankers For Net ZERO produce a report that says that because the UK Government is failing to support the 5.8 million smaller UK businesses, it will fail to meet its 2050 obligations.


The British Bank submits findings that 3% of all smaller businesses have measured their carbon footprint and 76% have taken no action to reduce carbon emissions. This is a big problem.

So what do you do as the UK Government when you

… have to meet legal carbon reduction obligations

… but the smaller businesses who are responsible for 30% of all carbon emissions are failing to produce the results you desire?

The answer is that you must find a way to incentivise smaller businesses to take action to reduce their carbon emissions. This incentive will come in the form of a new carbon tax, where businesses will have to pay for each tonne of carbon that they emit.

The idea being that businesses will be faced with a scenario where they can either

Option #1 Invest money to reduces their energy consumption,

which at the same time saves them money and reduces their carbon emissions


Option #2 Pay a carbon tax

Although the UK Government has yet to make a formal announcement about a new carbon tax, it will have to take some action in light of the three problems highlighted. To support such action, the ZERO Carbon Commission has already submitted a report to the UK Government that has made the following recommendations

Recommendation #1 : CARBON TAX ON BUSINESSES

All businesses should pay for £40 for each tonne of carbon emitted today.

Recommendation #2 : CARBON TAX ON PEOPLE

Everybody should pay for £40 for each tonne of carbon emitted.


The tase should increased to £55 per tonne by 2025 and as s a minimum, the carbon tax on people and businesses should be £75 per tonne by 2030.

So what does this mean for in additional cost for smaller businesses?

Typically the smaller businesses with under two employees will have a

carbon footprint of 30 tonnes and the immediate carbon tax will therefore

be £16,50 in 2025 rising to £2,250 (as a minimum) if they take no action.

Many businesses will have a larger carbon footprint, so the amount they have to pay will be higher.

A date for an announcement is unclear, but it will happen.

Remember this, the UK Government said that electric vehicles because they produced no emissions would be exempt from paying road tax. However on 17th November 2022, the government reversed that statement and said they would have to pay a road tax.

If a government can reverse a promise on the greenest forms of transport, can easily introduce an ‘incentive’ in the form of carbon tax.

Finally, the ZERO Carbon Commission said in their report that the carbon tax would raise in the region of £27 billion a year in funding by 2030.

What government would say no to that income at a time

when it has a £50 billion black hole in its budget?