In a historic move, Denmark is set to introduce the world’s first CO2 tax on agricultural emissions, specifically targeting livestock. This landmark policy, achieved through broad agreement among farmers, industry, and environmental groups, aims to significantly reduce greenhouse gas emissions. The tax, beginning in 2030, will gradually increase by 2035, with revenues dedicated to supporting sustainable farming practices. This initiative highlights Denmark’s commitment to climate goals and sets a global precedent.
Denmark to Become First Country to Implement CO2 Tax on Agricultural Emissions
Renowned for its pork and dairy exports, Denmark will impose a tax on livestock-related CO2 emissions beginning in 2030. This bold step aims to encourage other nations to adopt similar climate measures. The government reached an agreement with farmers, industry leaders, labor unions, and environmental organizations on this policy, focusing on agriculture as Denmark’s largest CO2-emitting sector.
“We will be the first country in the world to implement a genuine CO2 tax on agriculture. Other countries will follow suit,” stated Taxation Minister Jeppe Bruus.
Pending parliamentary approval, the proposed tax would start at 300 Danish crowns ($43.16) per tonne of CO2 in 2030, increasing to 750 crowns by 2035. Farmers will benefit from a 60% income tax deduction, effectively reducing their cost to 120 crowns per tonne initially, and 300 crowns by 2035. Additionally, subsidies will support adjustments in farming operations.
Minister for Economic Affairs Stephanie Lose noted, “The tax could add an extra cost of around 2 crowns per kilo (2.2 pounds) of minced beef in 2030.” This modest increase is expected to fit within the broader climate strategy.
Despite initial concerns, Danish farmers view the compromise as sustainable for their businesses. The L&F agriculture industry group remarked, “The agreement provides clarity on key aspects affecting farmers’ conditions.”
The agreement also establishes a 40-billion-kroner fund to protect natural areas, restore degraded ecosystems, and create forests and wetlands. Maria Reumert Gjerding, president of the Danish Society for Nature Conservation, emphasized, “This is a historic compromise that sets a new direction for land use.”
This tax supports Denmark’s target of reducing greenhouse gas emissions by 70% from 1990 levels by 2030. Finance Minister Nicolai Wammen stated, “A CO2 tax model aligned across all sectors ensures the lowest overall cost to society.”
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