This week, Denmark has solidified its plans to introduce the world’s first tax on agricultural emissions, including greenhouse gases emitted by livestock.
The plans were first announced as part of the Green Tripartite agreement in June 2024, aiming to pave the way for the green transformation of Denmark’s food and agricultural sector.
Following months of negotiations between the Danish government, farmers and the agri-food industry, the details of the measures projected to come into force in 2030 have now been confirmed.
Denmark, a major player in the pork and dairy industries, will implement a livestock levy for its farmers on greenhouse gas emissions from cows and pigs that exceed reduction targets.
The initial rates introduced will be DKK 300 (approx $42) per tonne of CO2e from 2030, set to increase to DKK 750 (approx $106) in 2035. However, an income tax deduction of 60% will be offered to farmers based on the average emissions levels for different types of livestock, providing an incentive to farmers with lower emissions.
After this tax break, the rates equate to a carbon tax of DKK 120 per tonne of CO2e (approx. $17) in 2030, rising to DKK 300 in 2035. The revenue generated by the levy will go toward the roll-out of green technologies and initiatives across the country’s agricultural sector.
The new measures align with Denmark’s Action Plan for Plant Based Foods, unveiled last year, aiming to support the transition toward a more climate-friendly food industry through the promotion of plant-based foods and alternative protein production.
The country has committed a further €55 million to its Plant Based Food Grant, which aims to support research and innovation across the category. Additionally, the grant – which was previously set to end in 2030 – will be made permanent.
Jasmijn de Boo, global CEO of industry organisation ProVeg, said: “This is the future of agricultural policy if we seriously want to mitigate the devastating effects of climate change”.
“Animal agriculture is responsible for up to a fifth of global greenhouse gas emissions, a fact that has been ignored or sidelined for too long. Further delay in action to reduce emissions from this sector will only worsen the situation for farmers as the climate crisis intensifies.”
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