Big Fight Coming over UN Global Shipping Tax

From CFACT

By David Wojick

The Trump administration has thrown its full weight against a proposed net-zero shipping emissions plan about to be approved by the member countries of the UN’s International Maritime Organization (IMO). Three Cabinet secretaries have issued a warning to other countries not to approve the so-called Net Zero Framework (NZF), which is generally considered to be a carbon tax on global shipping.

See here for the text of the warning.

The IMO was supposed to pass the NZF at its October meeting, but the Trump warning had a clear effect, so that vote never happened. All they did was vote to postpone voting on the emission reduction compliance program until the next meeting. Now the fight really begins.

NZF is not actually a tax, just penalties for failing to meet agreed-on emission limits, but it is still potentially costly so call it a tax. The IMO fact sheet is here.

Basically, each ship gets an assigned cap on CO2 and other greenhouse gas emissions per unit of energy expended. The caps get progressively lower over time, heading for zero in 2050.

If a ship gets below its cap it gets “surplus unit” (SU) credits for the difference that it can sell. If it exceeds the cap a little it must buy “Tier 1 remedial units (RU)” from IMO. If it exceeds the cap a lot it can either buy SUs or Tier 2 RUs which cost about four times as much as Tier 1 RUs.

It is buying the remedial units that amounts to a carbon tax on emissions, which by some estimates will be enormous. The Trump administration said in a press release that America “unequivocally rejects this proposal before the IMO and will not tolerate any action that increases costs for our citizens, energy providers, shipping companies and their customers, or tourists. The economic impacts from this measure could be disastrous, with some estimates forecasting global shipping costs increasing as much as 10% or more.”

Decarbonization of shipping is pretty much impossible, because it cannot be electrified. The sea lanes cannot be lined with charging stations. Refitting every ship in the world with nuclear propulsion would be even more expensive. Burning wood or corn might be even worse.

The net-zero thinkers are not known for reality, but, in this case, the greater the failure the more money they make. No wonder they like it!

Nor can the U.S. just walk away because shipping is truly global. Here is how the IMO fact sheet explains enforcement of things like NZF:

“Enforcement of all IMO regulations lies with the Member States, in their capacity as flag, port or coastal States. When a government accedes to an IMO Convention, it agrees to make it part of its own national law and to enforce it just like any other law. A Flag State must ensure that ships under its registry comply with IMO’s international rules and standards, including safety, environmental protection and labour conditions. A Port State has the right to inspect foreign ships in national ports to verify that compliance with IMO rules.”

How do foreign ports enforce NZF compliance on American ships? Or any ships for that matter. There is real potential for violence here, with a lot of money at stake.

Clearly the potential for disruption from the ill-conceived UN IMO NZF is enormous, and the fight is just beginning. Stay tuned to CFACT as this drama unfolds.

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October 22, 2025 2:11 pm

Decarbonization of shipping is pretty much impossible, because it cannot be electrified.

Technically, it can be “decarbonised” by returning to using sailing ships. It would just to be extremely expensive and slow.

Sweet Old Bob
Reply to  PariahDog
October 22, 2025 2:16 pm

Nuclear power works …..

😉

SxyxS
Reply to  Sweet Old Bob
October 22, 2025 2:56 pm

Of course it does.

If it wouldn’t work it would be crucial part of the renewable replacement scam,

It works so well that Russians have built several new icebreaker in recent years to crush the nonexistent arctic ice that has molten away several times according to experts like Al Gore.
The Russian must have missed the climate crisis and the disappearance of the ice when they launched project 22220.
Seems that they were so crazy to believe that western experts who have been wrong all the time would be wrong again .

David Wojick
Reply to  Sweet Old Bob
October 22, 2025 3:24 pm

I mention that in the article.

youcantfixstupid
Reply to  PariahDog
October 22, 2025 5:10 pm

Sailing ships may be slow but I have to wonder out loud if they wouldn’t provide some cost effective benefit. Not that I’m promoting doing it to support climate craziness but you might think using large sails on the open ocean may save on fuel…of course if this were true I’d also think shipping companies would already be embracing it.

Reply to  youcantfixstupid
October 22, 2025 7:13 pm

Sailing ships for cargo…the Somali pirates will have a field day with that.

Sparta Nova 4
Reply to  youcantfixstupid
October 23, 2025 7:59 am

Longer trips, more CO2 emitted via respiration by the crews, which will necessarily be larger.

And how do they cook food on sailing vessels? More CO2.

And when such ships become becalmed, what then?

Water, water, every where, and yet the boards do shrink.
Water, water, every where, nor any drop to drink.

Reply to  youcantfixstupid
October 23, 2025 9:44 am

…of course if this were true I’d also think shipping companies would already be embracing it.”

Which is why when a better, more cost effective way came along, sail phased out for just about everything but recreation.

Reply to  PariahDog
October 22, 2025 9:06 pm

Sailing ships use a lot of timber.

Back in the old days the construction of a single 110-gun ship in the 1700s required approximately 4,000 oak trees, equivalent to 30–40 hectares (74–98 acres) of woodland.

The UK no longer has the timber.

Hartley
Reply to  Redge
October 23, 2025 3:11 am

Um, news flash – you can build sailing ships out of steel – in fact, this was pretty common in the waning years of sail.
And there are some number of steel ships incorporating wind assist mechanisms to save fuel, though most do not look like traditional sails.

Reply to  Hartley
October 23, 2025 4:55 am

Lloyds Register have a lot of information about this. It’s coming
Search | LR

It turns out that businesses don’t like burning expensive fuel if they can avoid it.
I suspect that this is not necessarily for deep, heartfelt environmental ideals.

Reply to  Hartley
October 23, 2025 7:54 am

You can’t make good steel from windmills

gyan1
October 22, 2025 2:15 pm

Globalists are attacking on as many fronts as they can get away with. Trump is methodically undermining their plans.

SxyxS
Reply to  gyan1
October 22, 2025 2:40 pm

Indeed.
They just blew up refineries in Romania and Hungary.
While it was primarily a punishment for buying Russian oil
and wrong vote(Romanias voted 80% conservative during the election before the CiA cancelled them and readjusted the results, and Hungary elected a Hitler = antiglobalist,anti -invasion and for the people ),
it is also part of deindustrializing Europe.
While officially Russians will be blamed.

The problem with Trump “undermining” their plans is that it is always easier to destroy something complex than to built it. (4 years of Biden have proven it)
And we will see many more coincidences of the destructive kind the closer we get to (agenda) 2030.

Reply to  SxyxS
October 22, 2025 6:07 pm

Hungary elected a Hitler = antiglobalist,anti -invasion and for the people

Hmmm…. Does that description remind you of anyone else?

SxyxS
Reply to  Zig Zag Wanderer
October 23, 2025 1:34 am

Any other Hitler who has been fairly elected by the people and who does his job for the people and not for the WEF / NED etc = Putin,Erdogan,lesser known mini-me Hitler Fico who got shot as many time as Imran Khan and the Orange Man(people who are very popular and don’t go with the narrative have started to attract superauthentic assassins while the war criminals everyone hates never attract assassins. – experts may tell us why).
But not Georgescu as he was not allowed to become Hitler after he got 70% of the Romanian vote, and a few weeks later the left won the election in the biggest statistical shift since the ice age scare turned into.

Mr.
Reply to  gyan1
October 22, 2025 8:24 pm

A lesson from ‘Gen Corman’ “Apocalypse Now”

. . . things get confused out there: power, ideals, the old morality, practical military necessity. 

But out there it must be a temptation to be God, because there’s a conflict in every human heart, between the rational and the irrational, between good and evil, and good does not always triumph. 

Sometimes the dark side overcomes what Lincoln called the better angels of our nature. 

Every man has got a breaking point. 
You and I have one.

Tom Halla
October 22, 2025 2:16 pm

Treat the “fee” as an act of war? Looting is often a war aim.

Sweet Old Bob
Reply to  Tom Halla
October 22, 2025 2:34 pm

And the IMO is an enemy ? (yes)

😉

Tom Halla
Reply to  Sweet Old Bob
October 22, 2025 2:36 pm

The UN in general, and the PRC in particular.

sherro01
October 22, 2025 2:24 pm

Countries like my Australia already have laws about international agreements and taxation. It is my non-expert impression that countries like the US, Britain, Canada, Australia require the approval of the citizens expressed as a debated and agreed Act of Parliament before payments like this shipping impost can be legal. Apart from times of War, I cannot see how this impost can happen without such customary action. Geoff S

David Wojick
Reply to  sherro01
October 22, 2025 3:26 pm

It is an allowance trading program not an impost.

David Wojick
Reply to  David Wojick
October 22, 2025 3:43 pm

IMO makes environmental regulations for shipping under an established treaty. 2/3 of the voting countries have to approve them. Please read the article.

Leon de Boer
Reply to  David Wojick
October 22, 2025 5:36 pm

So if you read you would know IMO’s mandate is maritime safety and it added 1954 International Convention for the prevention of pollution of the sea by oil and International Convention for the Prevention of Pollution from Ships (MARPOL) in 1973. All of that makes sense.

Now it wants become what the “enforcer of climate regulations at sea” and with little to no oversight.

Not only is it over reach IT IS DANGEROUS.

Joe Crawford
Reply to  Leon de Boer
October 23, 2025 9:42 am

Sounds like all it has to do is accept the U.S. EPA’s Endangerment Finding or create one through the Brown Ring method. Then they’ll have the basis for regulating CO2 :<)

Sparta Nova 4
Reply to  sherro01
October 23, 2025 8:05 am

It seems to imply a mandate that countries signing on pass appropriate laws for enforcement.

How do we spell OWO?

mleskovarsocalrrcom
October 22, 2025 2:47 pm

More wealth redistribution. The UN Globalists/Marxists are WAY out of their lane as usual. When’s the last time they actually did something that’s in their mission like preventing wars? Mm by mm the UN is injecting their unelected bureaucracy into world affairs like they are already the One World Government. Their foster child, the EU, supports their every move and gives them some credibility. Another year won’t change Trump’s mind and I’m guessing he’ll have even more support by then against taxation without representation.

KevinM
Reply to  mleskovarsocalrrcom
October 22, 2025 3:55 pm

Went looking for verification of UN stated mission.
“Article 1
The Purposes of the United Nations are:

To maintain international peace and security, and to that end: to take effective collective measures for the prevention and removal of threats to the peace, and for the suppression of acts of aggression or other breaches of the peace, and to bring about by peaceful means, and in conformity with the principles of justice and international law, adjustment or settlement of international disputes or situations which might lead to a breach of the peace;
To develop friendly relations among nations based on respect for the principle of equal rights and self-determination of peoples, and to take other appropriate measures to strengthen universal peace;
To achieve international co-operation in solving international problems of an economic, social, cultural, or humanitarian character, and in promoting and encouraging respect for human rights and for fundamental freedoms for all without distinction as to race, sex, language, or religion; and
To be a centre for harmonizing the actions of nations in the attainment of these common ends.”

I agree with m-‘s words “something that’s in their mission like preventing wars“.

KevinM
Reply to  KevinM
October 22, 2025 3:57 pm

Wow, if you subtract all the “other stuff” they’ve gotten into, the only geography they’re even attempting to implement the stated mission is South of the Roman Empire.

Bob
October 22, 2025 2:48 pm

Yet another useless international organization. No international organization should be allowed to purchase or use any product shipped by sea unless the vessel is powered entirely by electricity.

Quilter52
October 22, 2025 3:30 pm

A tad discriminatory on countries that rely on shipping for their unimportant stuff like food, fuel etc. When are we going to stop this UN theft. The people who will pay this tax have no say at all in it.

It looks to me just like a new form of protection. Australia and New Zealand used to be able to grow, process and export lamb for less than it cost to produce in England and Europe. Not sure it is still true due to the idiocy of our governments. But it sure protects inefficient farmers. Pity it is so costly for the poor.

ResourceGuy
October 22, 2025 3:47 pm

If it were implemented post DJT, I can already name the countries that will ignore it while turning off their GPS trackers.

KevinM
October 22, 2025 3:49 pm

Seems like an attempt at adding a massive new layer of global governance.
Covered here and…
The news this morning did not mention it.

ResourceGuy
October 22, 2025 3:50 pm

It is the global tax revenue prospect that lures them ever on even in the next ice age. They already have a track record with the Ed Markey response “Who could have known?”

youcantfixstupid
October 22, 2025 5:08 pm

“How do foreign ports enforce NZF compliance on American ships? Or any ships for that matter. There is real potential for violence here, with a lot of money at stake.”

And THAT is the crux of the matter…or maybe a huge opportunity for the US…e.g. any ship flagged under the US will have the backing of Trump…I can just see it now, Trump will go all Scarface on countries trying to collect the tax…”Say hello to my leetle friend”

cgh
October 22, 2025 5:10 pm

This is mere ‘sound and fury signifying nothing’. The tax will never happen. The UN has no power to enforce a tax of any kind. It cannot even enforce collection of its own membership dues. And it really doesn’t matter how many year-end UNFCCC conferences agree on this. They can and have called for many things, none of which have taken place.

October 22, 2025 7:56 pm

A rose by another name is still a rose.

George Thompson
Reply to  whsmith@wustl.edu
October 23, 2025 5:52 am

And S still stinks…UN out!

Art Slartibartfast
October 23, 2025 1:44 am

Shipping accounts for approximately 3% of global CO2 emissions. This is such a pointless exercise, reducing a minimal amount of a trace gas that by itself has a minimal effect on climate. If you just physically burn the money it would potentially have a better use, it might keep someone warm.

David Wojick
October 23, 2025 3:23 am

Decarbonizing ship propulsion is now big industry:
https://www.maritimepropulsion.com/
Including sails for freighters.

Rod Evans
October 23, 2025 3:31 am

This is nothing more than the UN finding ways to secure its core funding beyond member states contributions. Those current contributions can be stopped at any moment so the UN knows it must establish self financing revenue streams.
The ongoing Net Zero global policy is developed by the UN and its agencies and is the prime vehicle to provide the funding needed to enable future security for the bureaucracy.
We have to stop this one world government ideology while we still can.
We can’t hit them in the ballot box and they know it because they are never elected just simply appointed by their like minded colleagues.
The left wing take over of world affairs is bringing humanity down. A cynic might conclude that is their prime objective. Civilisation is built on affordable available energy reliably available and easily accessed. Why the UN would want to remove that foundation of civilised society simply to provide itself with easy cash, I have no idea?

Sparta Nova 4
Reply to  Rod Evans
October 23, 2025 8:10 am

Change “left wing” to “illiberals”

rtj1211
October 23, 2025 5:17 am

Since when did the UN have any legislative powers?

Sparta Nova 4
October 23, 2025 7:53 am

One serious point that is missing is that the NZF tax includes provisions that if a port authority determines a ship is noncompliant, it can impound the ship.

Jeff Alberts
Reply to  Sparta Nova 4
October 24, 2025 10:32 am

Guess which ports won’t receive shipments.

sherro01
October 23, 2025 2:08 pm

President Trump said on TV to a global audience that he had stopped 7 wars and was confident he could bring peace to the Palestine conflict.
He added that he received no help from the United Nations. They did not even contact him as he reduced conflict in his first 8 months in office.the Charter of the UN, you will see it is only about reduction of armed conflict.
The UN has not only failed its primary charter. It has wandered off like control freaks while President Trump did the heavy lifting without it even offering to help.
Something is badly wrong with the UN.
Geoff S
If you read

Billyjack
October 24, 2025 5:44 am

I am always amused by the Church of Warming’s hysteria over miniscule greenhouse gas emissions, but never a word about the billions of cubic feet of methane that went into the atmosphere when they blew up the Nordstream 2 pipeline that probably put as much gas in the atmosphere as 10 years of emissions by shipping.

cheesypeas
October 24, 2025 5:48 am

I’m sure the low-carbon certificate is obtainable for a suitable Port fee at any port.
And, that fee will be low to zero if your government owes the CCP a few favours.