‘Scary Experiment’: Denmark to Tax Livestock Emissions, Critics Say Small Farmers Are Real Target

As Denmark prepares to become the first country in the world to tax farmers for…

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Denmark is set to become the first country in the world to tax farmers for the greenhouse gasses emitted by their livestock, in a deal reached June 24 between the Danish government and representatives of the farming industry and unions.

The tax, which specifically targets methane emissions by cows, pigs and sheep, will take effect in 2030, pending final approval by the Danish Parliament, The Associated Press (AP) reported.

Beginning in 2030, farmers will be required to pay a tax of 300 kroner (approximately $43) per ton of carbon dioxide equivalent. This will increase to 750 kroner ($108) by 2035. After a 60% tax deduction, the respective amounts will be 120 kroner ($17.30) and 300 kroner.

CNN, quoting Denmark’s “green think tank” Concito, reported that Danish dairy cows emit, on average, 5.6 tonnes (6.2 U.S. tons) of CO2-equivalent emissions per year. This would result in a tax of 672 kroner per cow ($96) in 2030 and 1,680 kroner ($241) in 2035.

The respective emissions figure for all Danish cows is an average of 6.6 tons of CO2-equivalent annually, according to the AP, which reported that the Danish government aims to reduce the country’s greenhouse emissions by 70% from 1990 levels by 2030, citing Taxation Minister Jeppe Bruus.

According to CNN, the proceeds from the tax will be used to support the agricultural industry’s green transition in the first two years, including the investment of 40 billion kroner ($3.7 billion) for measures including reforestation and establishing wetlands.

After two years, the tax will be “reassessed.”

Denmark is a significant exporter of pork and dairy products, CNN reported. Agriculture is the country’s largest source of greenhouse gas emissions. The AP reported that, as of June 2022, there were nearly 1.5 million cows in Denmark.

Tax will encourage farmers ‘to look for solutions to reduce emissions’

Proponents of the tax emphasized that Denmark is the first country to enact such a policy, characterizing it as a step toward greater environmental sustainability.

“We will take a big step closer in becoming climate neutral in 2045,” Bruus said.

“We are investing billions in the biggest transformation of the Danish landscape in recent times,” said Danish Foreign Minister Lars Lokke Rasmussen in a statement quoted by CNN. “At the same time, we will be the first country in the world with a (carbon) tax on agriculture.”

According to Torsten Hasforth, Concito’s chief economist, “The whole purpose of the tax is to get the sector to look for solutions to reduce emissions,” CNN reported. Hasforth noted that farmers could, for instance, change the feed they use, as part of their efforts to reduce emissions.

The Danish Society for Nature Conservation called the tax “a historic compromise,” in remarks quoted by the AP. The organization’s president, Maria Reumert Gjerding, said, “We have succeeded in landing a compromise on a CO2 tax, which lays the groundwork for a restructured food industry — also on the other side of 2030.”

And Ben Lilliston, director of Rural Strategies and Climate Change at the Institute for Agriculture and Trade Policy, told PBS NewsHour that methane emissions are “a huge problem … a huge challenge.” He argued that while methane remains in the atmosphere for fewer years than CO2, it has “about 80 times the potency.”

“If you reduce methane, you can get more near-term results and allow us to have a little longer of a window to reduce carbon dioxide emission,” Lilliston said…