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World First: Denmark to Pioneer CO2 Tax on Farms

The country is on track to become the first to impose a carbon dioxide tax on livestock emissions beginning in 2030.

Cattle grazing
Cattle grazing in Denmark

Following Denmark's publication late last year of the world’s first ever national action plan for shifting its population towards plant-based diets in order to radically reduce the country's climate footprint, the government has now announced the next phase of its ambition to cut emissions by 70 percent from 1990 levels by 2030.

The agriculture sector, which is the country’s greatest producer of CO2 emissions, is the main focus of this project. “We will be the first country in the world to introduce a real CO2 tax on agriculture. Other countries will be inspired by this,” according to Taxation Minister Jeppe Bruus.

Crucially, the CO2 tax on livestock already has widespread support from farmers, industry leaders, unions, and environmental organisations. The proposed tax structure would charge farmers 300 Danish crowns ($43.16) per tonne of CO2 in 2030, rising to 750 crowns by 2035.

To get the support of farmers and other stake holders, the government has incorporated provisions for income tax breaks and subsidies. Farmers will be eligible for a 60 percent income tax rebate, effectively lowering the cost per tonne to 120 crowns initially, rising to 300 crowns by 2035, reports Reuters. Furthermore, subsidies will be available to help farmers change their operations to meet new environmental regulations.

Denmark’s bold and pioneering CO2 tax on agriculture is a key step toward more sustainable farming practices and climate action, and the country hopes to set an example for other countries by leading the way in environmental policy, and demonstrating that economic progress and environmental responsibility can coexist.


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