In a groundbreaking move, Denmark will become the first country to impose a carbon tax on its agricultural sector. The Danish government reached an agreement on June 24, 2024, after five months of negotiations with key stakeholders including the Danish Agriculture and Food Council, the Danish Society for Nature Conservation, and the Confederation of Danish Industry. The new tax aims to significantly cut greenhouse gas emissions from farming, which is crucial for Denmark to meet its ambitious climate targets.
The tax will start at 120 Danish kroner (€16) per ton of CO2 equivalent in 2030, increasing to 300 kroner (€40) by 2035. The plan includes a basic deduction that provides economic incentives for climate-efficient farmers, ultimately aiming to encourage sustainable agricultural practices.
Denmark is moving ahead with the world’s first carbon tax on agriculture, with cattle farmers set to be charged almost €100 a year per cow. “I think it’s crazy,” said the chair of farmer's organisation.
More Net Zero madness. #CostOfNetZero
👉 https://t.co/iEy7J4xaDw pic.twitter.com/jIkYYzcgWP
— Net Zero Watch (@NetZeroWatch) June 26, 2024
The revenue generated from the tax will be reinvested into the agricultural sector to support green initiatives, climate technology, and production transformation.
Additionally, the agreement outlines substantial funding for environmental restoration projects, including the establishment of more forests and the restoration of peatlands, which are vital for carbon sequestration and water quality.
This is the REAL Mad Cow Disease!
Denmark to charge farmers €100 a cow in first carbon tax on agriculture
It’s coming. Resist!
Vote @ADFParty
https://t.co/8ucaTStMtc— Dr Teck Khong (@DrTeckKhong) June 26, 2024
The introduction of this tax is a response to the agricultural sector's significant contribution to Denmark's overall emissions, which are projected to account for 46 percent by 2030 without new policies. By implementing this tax, Denmark aims to reduce emissions by 1.8 million tonnes in its first year of operation.
This initiative has sparked debate among various stakeholders. Environmental groups like Greenpeace Denmark have welcomed the tax, seeing it as a necessary step to drive climate action and support sustainable farming. Conversely, industry representatives have expressed concerns about the potential economic impact on farmers and the risk of production moving abroad if the tax is too high.
Denmark's move comes amidst a broader European conversation about agricultural emissions and sustainability. The country hopes to set a precedent for other nations by demonstrating that it is possible to balance economic and environmental interests through innovative policy measures.
With this new tax, Denmark is not only aiming to meet its national climate goals but also to contribute to global efforts in combating climate change. This pioneering approach highlights the urgent need for all sectors to participate in the green transition and showcases Denmark's commitment to leading by example in environmental stewardship.
