Denmark is set to become the first country to introduce a tax on carbon emissions from livestock, aiming to meet ambitious climate targets. This pioneering move, announced by the Danish government on Tuesday, targets the agricultural sector, the nation’s largest source of CO2 emissions, as part of efforts to slash greenhouse gases by 70% from 1990 levels by the year 2030.
Originally proposed by government-appointed experts in February, the tax forms a key component of Denmark’s strategy to achieve its legally binding climate goals. The centrist government secured a comprehensive agreement with farmers, industry representatives, labour unions, and environmental groups on Monday night.
Under the new scheme, set to start in 2030, farmers will be taxed 300 Danish crowns (£34) per tonne of CO2, rising to 750 crowns by 2035. To ease the burden, farmers will receive a 60% income tax deduction, reducing the effective cost to 120 crowns initially, and rising to 300 crowns. Additionally, subsidies will be provided to support farmers in adapting their operations.
This move could see a slight increase in the price of minced beef, estimated to add about 2 crowns per kilo by 2030. Despite initial concerns about potential impacts on production and jobs, the agricultural sector has welcomed the compromise, which provides clarity and support for maintaining their businesses.
While Denmark forges ahead, other countries, like New Zealand, have recently backed away from similar measures due to pushback from their farming communities. Denmark’s bold step could potentially set a new global standard for addressing agricultural emissions.