# Will Malaysia's planned carbon tax reduce the CBAM charge on Malaysian steel?

Canonical: https://senseible.earth/answers/malaysia-carbon-tax-steel-cbam-deduction

Only once it is in force and actually paid on the emissions behind the goods. Malaysia has announced a carbon tax starting with iron, steel and energy. If the tax has rebates or a low rate, the deduction shrinks to what was effectively paid.

## How the deduction works

Article 9 of the CBAM Regulation allows a reduction for a carbon price effectively paid in the country of origin, net of any rebate or other compensation.

## Evidence needed

- Tax paid by the installation for the period, with official receipts.
- The emissions the tax was charged on.
- A calculation linking the tax to the tonnes of goods exported.

## Until it starts

No deduction is possible for a tax that is announced but not yet charged. Plan pricing on the full CBAM charge and check the tax's final design when it is published.

## What Senseible does here

Senseible reads fuel, electricity and production documents into dated, fingerprinted installation records, the starting point for the actual emissions an EU importer asks for.

- [Korea ETS and the CBAM deduction](https://senseible.earth/answers/korea-ets-carbon-price-cbam-deduction)
- [Kuantan steel CBAM data](https://senseible.earth/answers/kuantan-blast-furnace-steel-exporter-cbam)
- [EU ETS vs CBAM](https://senseible.earth/answers/eu-ets-vs-cbam-difference)

Sources: [CBAM Regulation (EU) 2023/956, consolidated](https://eur-lex.europa.eu/eli/reg/2023/956/2025-10-20), [European Commission, CBAM definitive regime](https://taxation-customs.ec.europa.eu/carbon-border-adjustment-mechanism/cbam-definitive-regime_en)

Last reviewed 2026-10-22.