UK to cut steel import quotas and impose 50% tariff from July

The UK government has announced a new steel trade measure that will take effect on July 1, 2026, aimed at strengthening domestic production and addressing global overcapacity.

Under the new system, tariff-free import quotas will be reduced by 60% compared to the current safeguard mechanism. Imports exceeding these quotas will be subject to a 50% tariff. The measure will apply to steel products that can be produced domestically.

The policy will be implemented under the Taxation (Cross Border Trade) Act 2018 and forms part of a broader strategy to support the UK steel sector and safeguard supply chains linked to critical infrastructure, defence and energy.

According to the government, global steel overcapacity remains a key structural challenge. Data cited from the OECD indicates that the gap between capacity and demand could reach 721 million tonnes by 2027, exceeding total OECD production capacity.

At the same time, UK crude steel output has fallen by more than 50% over the past decade, reflecting sustained pressure from high costs and international competition.

The new regime introduces revised tariff-rate quotas (TRQs) across multiple product categories, defining both the volume of steel that can enter the UK duty-free and the applicable tariff for out-of-quota imports. Further adjustments to product scope and quota levels may still be made ahead of implementation.

Source: UK government, Photo: Fotolia