US Helps Sink World’s First Global Carbon Tax After Threatening Sanctions Against Countries Supporting It

A fierce Trump administration push to stop the global shipping industry from paying for its own climate pollution appeared to have been successful Friday, as efforts to approve the “world’s first global carbon tax” collapsed.

It had been widely assumed the tax would be adopted during a summit in London at the International Maritime Organization (IMO), the UN-backed body that governs global shipping. But after four days of fraught negotiations, countries agreed to delay a vote on whether to approve it by 12 months.

The decision came after a vociferous US State Department campaign, with Donald Trump calling it a “scam tax” and the State Department threatening reprisals on countries supporting it.

Experts say the collapse of the talks marks not only a significant blow for attempts to clean up a heavily climate-polluting industry, undermining decades of negotiations, but also represents yet another failure of climate diplomacy.

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IMO member states agreed in 2023 that the shipping industry would reach net zero emissions — removing as much planet-heating gas from the atmosphere as it emits — by around 2050.

One of the measures proposed as part of this was a tax on the industry’s climate pollution. The shipping industry would have paid the tax into a fund created by the IMO to encourage emissions reductions and raise funds for climate action. IMO member nations approved the tax at a chaotic April meeting that the US abandoned part way through. The October talks were intended to formally adopt it.

While the tax was supported by members including the European Union, Brazil, and small island states such as Vanuatu, oil-producing countries including the United States and Saudi Arabia opposed it strongly.

The Trump administration spent weeks calling on countries to reject the vote. The US will “not tolerate any action that increases costs for our citizens, energy providers, shipping companies and their customers, or tourists,” the State Department said in a statement this month.

It laid out a series of threats against countries that supported the tax including potentially blocking vessels from US ports, visa restrictions, increased fees, and sanctions on “officials sponsoring activist-driven climate policies that would burden American consumers.”

In a post on Truth Social Thursday, Trump said he was “outraged” at the vote and that the US “would not stand for this Global Green New Scam Tax.”

After days of chaos and disagreement at the IMO talks, Singapore put forward a motion to delay the decision on Friday, which was called to a vote by Saudi Arabia.

A legally binding carbon tax on shipping would have been a big deal. “It would have marked the first-ever — and legally binding — carbon tax. This explains why petro-states including the United States tried so hard to scuttle the framework,” said Christiaan De Beukelaer, a senior lecturer in culture and climate at the University of Melbourne.

A State Department official told CNN the vote demonstrates American leadership on the global stage: “Now we have a President who will always lead in putting America first and even worked to prevent consumers from around the world from paying higher prices as well.”

The global shipping industry is responsible for around 3% of global planet-heating pollution annually, a figure that could rise to 17% by 2050 if no action is taken, according to a 2018 European Parliament analysis.

The industry has tended to slip under the radar when it comes to climate action, in part because so much of its activity happens in international waters, making the question of accountability for its climate pollution more complex.

The failure to adopt the tax is a huge missed opportunity, experts say. “Every delay means that innovation will struggle to scale, inequities will deepen, and the transition to clean shipping will become harder and more costly,” said Natacha Stamatiou of the Environmental Defense Fund (EDF).

There are also fears about what it means for climate diplomacy. Other recent efforts to tackle the escalating climate crisis have either collapsed, such as attempts to negotiate the world’s first global plastics treaty, or failed to meet hopes, including last year’s COP29 climate conference in Azerbaijan, which ended in bitterness and a finance deal described by some developing countries as a “betrayal.”

Experts are concerned for what this might mean for ambition levels at the upcoming COP30 climate conference in Belém, Brazil next month.

The failure of the IMO to adopt a carbon tax “marks a failure of this United Nations agency to act decisively on climate change,” said Ralph John Regenvanu, Vanuatu’s Climate Change Minister. “This makes the road to Belém and beyond more difficult.”