Tung says US carbon tax plan verges on protectionism

Tung Chee-hwa, the former chief executive of Hong Kong who now serves a top advisor to the Chinese government, warned Tuesday that a proposed US tax could spark a protectionist trade war, the Financial Times reported. Speaking at New York University, Tung, vice-chairman of the Chinese People’s Political Consultative Conference, said he was “distressed” by the new bill introduced in Congress that would introduce a greenhouse gas emissions cap and trade program. Under the bill, the US government could levy import taxes on foreign manufacturers shipping goods to America as a penalty for the carbon contained in those goods. US Energy Secretary Steven Chu told Congress in March that the carbon border tax would help “level the playing field” with countries that have looser carbon standards. Tung said the move “is particularly unfair to China,” and suggested it could be challenged through the WTO. A vote on the bill could come as early as June.