UK CBAM after Budget 2026: what changed, and what didn't

Last verified: 2 November 2026

Author: Oremly

Short answer: Budget 2026, on 28 October 2026, made three UK CBAM announcements. Only one touches goods you could import from 1 January 2027: the government says it will use Finance Bill 2026-27 to take other ferro-silicon (commodity code 7202 29) out of scope from that date. That is not law yet, so as the Act stands 7202 29 is still a CBAM good and still counts towards the £50,000 threshold. The Budget also opened a consultation on adding refinery products (petrol, diesel, jet fuel and kerosene) to CBAM at some later date, and confirmed country-specific default values from 2029. The CBAM rates, the £50,000 threshold, the registration and return dates and the 2027 and 2028 default values did not change.

This post is for finance and operations teams at steel stockholders, fastener importers, builders' merchants and aluminium fabricators. It sets out each announcement, what the law says today, a short test of whether any of it affects you, and a dated worked example for a business that imports ferro-silicon alongside steel. It is not tax advice. Oremly is software and plain-English guidance.

The three announcements at a glance

Announcement	Where it is	Status on 2 November 2026	Effect on 2027 imports
Add 7202 29 (other ferro-silicon) to the ferro-silicon exceptions from 1 January 2027	Budget 2026 overview of tax legislation and rates (OOTLAR), paragraph 1.73; Budget resolution 107	Announced. Needs Finance Bill 2026-27, which has not been published	Only if you import 7202 29
Consult on bringing refinery products into CBAM	HM Treasury and HMRC consultation, 28 October 2026; OOTLAR paragraph 2.28	Open until 23:59 on 20 January 2027. A proposal, with no start date	None
Country-specific default values from 2029	Budget 2026 document	Policy confirmed, not yet in law. No values published	None in 2027 or 2028

1. Other ferro-silicon (7202 29): announced, not yet law

What the Act says today. Schedule 16 to the Finance Act 2026 lists the whole of chapter 72 as CBAM goods, then names exceptions. For ferro-silicon, the only exception is 7202 21, which the UK Trade Tariff describes as ferro-silicon "containing by weight more than 55 % of silicon". 7202 29 ("Other" ferro-silicon, including 7202 29 10, which contains 4% to 10% magnesium) is not excepted, so it is a CBAM good. HMRC's goods within the iron and steel sector guidance (16 July 2026) also names only 7202 21. HMRC's policy summary annex lists "7202 2", all ferro-silicon, as excepted, which is the mismatch the Budget sets out to fix. On 2 November 2026, legislation.gov.uk showed "no known outstanding effects" for Schedule 16.

What the government says it will do. OOTLAR paragraph 1.73: "the government will introduce legislation in Finance Bill 2026-27 to correct a minor error in Finance Act 2026. This will add commodity code 7202 29 (other ferro-silicon) to the existing ferro-silicon exceptions from scope from 1 January 2027." The Budget resolution tabled the same day says the provision may be made "clarifying that goods with the commodity code 7202 29 (other ferro-silicon) are not CBAM goods for the purposes of Part 5 of the Finance Act 2026", and that it may have "retrospective effect". Unlike some Budget resolutions, it is not declared to have statutory effect under the Provisional Collection of Taxes Act 1968, so it does not change the law by itself.

Does 7202 29 count towards £50,000 now? Yes. The threshold test in Schedule 17, paragraph 2(2) counts "CBAM goods", and as the Act stands 7202 29 is one. Until the change is enacted, keep CBAM records for 7202 29 and count it towards £50,000. If the change is enacted as announced, with effect from 1 January 2027, 7202 29 would be excepted from the start of UK CBAM, so it should come out of the count and the charge. Check the Bill's wording when it is published, including how it treats any registration already triggered.

No default value to fall back on. The draft default values notice of 16 October 2026 gives default values for ferro-manganese, ferro-chromium and ferro-nickel codes, but none for any 7202 29 code. That fits the plan to except it. It also means that, as things stand, there is no published default for 7202 29 if you ever had to report it.

The other ferro-alloys are unchanged. Ferro-manganese (7202 11 and 7202 19), ferro-chromium (7202 41 and 7202 49) and ferro-nickel (7202 60) are not in the exceptions list and were not mentioned in the Budget. They are CBAM goods from 1 January 2027. The existing exceptions (7202 21, 7202 30, 7202 50, 7202 70, 7202 80, 7202 91, 7202 92, 7202 93, 7202 99 10, 7202 99 30, 7202 99 80 and ferrous scrap, 7204) stay as they are.

The difference between 7202 21 and 7202 29 is silicon content, so it is a classification question. Check the code and the silicon content on your import declarations, not the supplier's product name. Our UK CBAM exemptions post covers the rest of the Schedule 16 exceptions.

Worked example: how the ferro-silicon fix moves one importer's threshold date

Illustrative only, prepared on 2 November 2026. The business, goods, dates and prices are made up, not market prices. Draft default values and HMRC's illustrative rate are used because the real rates are not yet published.

A UK distributor supplies foundries and builders' merchants. In 2027 it imports four consignments and nothing else:

Date (2027)	Goods (commodity code)	Value	Running total as the Act stands	Running total if 7202 29 is excepted
Tuesday 12 January	30 tonnes of rebar (7214 20 00) at £600 a tonne	£18,000	£18,000	£18,000
Monday 8 February	10 tonnes of magnesium-bearing ferro-silicon (7202 29 10, 4% to 10% magnesium) at £1,600 a tonne	£16,000	£34,000	£18,000 (not counted)
Thursday 4 March	30 tonnes of rebar (7214 20 00)	£18,000	£52,000	£36,000
Wednesday 14 April	30 tonnes of rebar (7214 20 00)	£18,000	£70,000	£54,000

Forward test. No 30-day period holds £50,000 or more of imports. The closest consignments are 27 days apart (12 January and 8 February, £34,000) and 24 days apart (8 February and 4 March, £34,000), so the 30-day test is never met.

Backward test, as the Act stands. The running total reaches £52,000 on Thursday 4 March 2027. HMRC's registration date guidance says that if your imports meet the threshold, "you may be liable to register for CBAM from the date your imports met the £50,000 registration threshold", so plan from 4 March. The law applies the look-back when "it is the first day of the month", so the first statutory test that finds £50,000 or more is Thursday 1 April 2027, looking back over 1 January to 31 March (£52,000).

Backward test, if 7202 29 is excepted. The ferro-silicon drops out, and the total first reaches £50,000 on Wednesday 14 April 2027 (£54,000). On HMRC's guidance, plan from 14 April; on the law's wording, the first-of-month test that finds it is Saturday 1 May 2027.

So the fix moves this business's planning date from 4 March to 14 April, 41 days later. Which consignments are charged then depends on that date. Goods imported before you are registrable are not charged (section 147(1)(a)), so the 8 February ferro-silicon is not charged on any reading. HMRC does not say whether the consignment that takes you to £50,000 is itself charged, so we plan for it to be.

Basis	As the Act stands	If 7202 29 is excepted
HMRC guidance date (our planning basis)	4 March and 14 April rebar charged: about £1,767	14 April rebar charged: about £884
Law's first-of-month date	14 April rebar charged: about £884	None of these four charged: £0 (later imports would be)

Each rebar consignment: 30 tonnes × 3.040 tCO2e per tonne (draft default value for 72142000) = 91.2 tCO2e, × £9.69 (HMRC's illustrative iron and steel rate) = £883.73, so about £884. The real figure would use the published iron and steel rate for the quarter of import.

Either way the business triggers registration in 2027, so it has until 31 January 2028 to register, and its 2027 return and payment are due by 31 May 2028. Until the Finance Bill is law, plan on the "as the Act stands" column. It gives the earlier date and the larger bill.

2. Refinery products: a consultation, not a change

HM Treasury and HMRC published a consultation on sectoral scope expansion to include refinery products on 28 October 2026. It closes at 23:59 on 20 January 2027. Its proposed list at paragraph 4.10 is 15 eight-digit codes under heading 2710, covering "types of petrol, diesel, jet fuel and kerosene".

There is no start date. The consultation says the government intends to include "a subset of refinery products in CBAM as soon as it is feasible" and "will set out a timeline in due course". From 1 January 2027, UK CBAM covers five sectors: aluminium, cement, fertiliser, hydrogen, and iron and steel. Fuels are not CBAM goods and do not count towards your £50,000.

If you import fuels in bulk, the consultation is the place to make your case: responses go through the online form on the consultation page, and further evidence to cbampolicyteam@hmrc.gov.uk. For steel and aluminium importers, there is nothing to do.

3. Country-specific default values from 2029

The Budget 2026 document says the government "will introduce CSDVs for the UK CBAM from 2029, replacing the initial global default values used in 2027 and 2028". The draft default values notice already said this. It sets one default value per good, in force from 1 January 2027 to 31 December 2028, then "one default value per CBAM good per country" from 2029. The markup, now 10% in every sector except fertiliser, will be "reviewed at this time".

No country-specific values have been published, so nobody can yet say whether your suppliers' countries will come out higher or lower. For 2027 and 2028, budget with the single draft values. If you expect to rely on defaults beyond 2028, keep the country of origin with every import line and keep asking suppliers for verified data. Our post on UK CBAM default values or supplier data has a decision test.

What Budget 2026 did not change

The rates. There is still no real UK CBAM rate. HMRC's figures of 16 October 2026, including £9.69 per tonne of CO2e for iron and steel and £9.79 for aluminium, are "illustrative only". The rates for 1 January to 31 March 2027 "will be published before the end of the year". See what the UK CBAM rate is.
The £50,000 threshold and its two tests. You trigger registration if, on the first day of a month, your CBAM imports over the previous 12 months were £50,000 or more, or if you expect to import £50,000 or more in the next 30 days. For 2027, look back only to 1 January 2027. The law applies the look-back when "it is the first day of the month"; HMRC's guidance says liability can date from the day your imports met £50,000. Plan from the earlier date. Our CBAM threshold checker takes monthly values or a CSV of your import lines.
Registration dates. Registration opens on 1 January 2028. If you trigger registration in 2027, you have until 31 January 2028 to register. See when to register for UK CBAM.
The 2027 return. 2027 is one accounting period, with the return and payment due by 31 May 2028. Quarterly periods start in 2028.
The 2027 and 2028 default values. The draft notice of 16 October 2026 is unchanged.
The five sectors and every Schedule 16 exception other than the planned 7202 29 change.
EU-origin goods. No exemption is in force. HMRC's policy summary still says "There are currently no jurisdictions exempt from CBAM", and the Budget did not change that. See UK CBAM threshold vs the EU's 50 tonnes.
No small-consignment exemption. There is still no £500 or other de minimis per consignment.

Does Budget 2026 change anything for you?

Find the row for each type of goods you import.

If you import	What Budget 2026 changes	What to do now
Steel bars, coil, plate, sections and tubes, or fasteners (chapter 72 other than 7202 and 7204, and 7301 to 7311, 7318, 7326)	Nothing	Carry on: track your £50,000 total, keep records from 1 January 2027, ask suppliers for emissions data
Aluminium goods (7601, 7603 to 7614, 7616)	Nothing	As above
Ferro-silicon with more than 55% silicon (7202 21)	Nothing. Already excepted	Keep the evidence of classification
Other ferro-silicon, including magnesium-bearing ferro-silicon with 4% to 10% magnesium (7202 29). Ferro-silico-magnesium (7202 99 30) is already excepted	The government plans to except it from 1 January 2027	Count it towards £50,000 and keep records until Finance Bill 2026-27 is law. Work out your threshold date with and without it
Ferro-manganese, ferro-chromium or ferro-nickel (7202 11, 7202 19, 7202 41, 7202 49, 7202 60)	Nothing. Still CBAM goods	Budget for them using the draft default values
Petrol, diesel, jet fuel or kerosene (2710)	Not CBAM goods. A consultation proposes adding some later	Respond by 23:59 on 20 January 2027 if it affects you
Any goods for which you plan to use default values after 2028	Defaults become per country from 2029	Record the country of origin on every line; keep asking for supplier data

If none of your commodity codes starts with 7202 or 2710, Budget 2026 has not changed your 2027 CBAM position.

Dates to diarise

1. Before 31 December 2026: the first real CBAM rates, for January to March 2027, are due to be published.

2. 1 January 2027: UK CBAM starts. The government intends the 7202 29 exception to apply from this date.

3. 23:59 on 20 January 2027: the refinery products consultation closes.

4. Finance Bill 2026-27: no publication date announced. When it is published, check the 7202 29 clause.

5. 1 January 2028: registration opens. 31 January 2028: deadline for 2027 triggers.

6. 31 May 2028: 2027 return and payment due.

7. 2029: country-specific default values replace the single values.

Reader questions

Is 7202 29 ferro-silicon exempt from 1 January 2027?

Not yet. The government has said it will legislate in Finance Bill 2026-27 so that it is excepted from 1 January 2027. Until that Bill is law, Schedule 16 still makes 7202 29 a CBAM good.

What if the Finance Bill passes after 1 January 2027?

The government says the change will apply from 1 January 2027, and the Budget resolution allows the provision to have retrospective effect. No CBAM is payable for 2027 imports until the return due by 31 May 2028. The government has not said when the Bill will be published or passed, so keep counting 7202 29 and keep the records until it is.

Did the Budget change the CBAM rate or the £50,000 threshold?

No. Neither was changed. The first real rates are still due before the end of 2026.

Will my 2027 default values change because of country-specific values?

No. The draft notice says the current values apply from 1 January 2027 to 31 December 2028. Country-specific values start in 2029.

Do I need to respond to the refinery products consultation?

Only if you import or use the fuels it covers and want to influence the design. It does not change anything for 2027.

Where Oremly fits

Oremly maps each product to its commodity code and keeps a running £50,000 total from your import entries, so you can see the day you reach the threshold and the first-of-month check that follows. If you import 7202 29, keep those lines in the total until the Finance Bill is law. You still register, file and pay HMRC directly.

Sources

Primary sources checked on 2 November 2026:

Budget 2026: overview of tax legislation and rates (OOTLAR) (HM Treasury, 28 October 2026; paragraph 1.73 ferro-silicon, paragraph 2.28 refinery products)
Budget 2026 (HTML) (HM Treasury, 28 October 2026; country-specific default values)
Budget resolutions, 28 October 2026 (UK Parliament; resolution 107, correction of minor errors)
CBAM: a consultation on sectoral scope expansion to include refinery products (HM Treasury and HMRC, 28 October 2026, with the consultation document)
Finance Act 2026, Schedule 16 (CBAM goods)
Finance Act 2026, Schedule 17, paragraph 2 (duty to register) and section 147 (exemptions)
The CBAM (Transitory Provision) Regulations 2026, S.I. 2026/830 (31 January 2028 registration deadline; 31 May 2028 return)
Goods within the iron and steel sector (HMRC, 16 July 2026)
CBAM: policy summary (HMRC, updated 16 October 2026)
The CBAM (Default Values) Force of Law Notice (Draft) (16 October 2026)
Illustrative CBAM rates and worked example and Rates for CBAM (HMRC, 16 October 2026)
Work out the date you'll need to register for CBAM (HMRC, 16 July 2026) and Check if you'll need to register for CBAM (HMRC collection)
UK Trade Tariff, heading 7202 (ferro-alloy descriptions)

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