Denmark to Tax Livestock Farmers for Greenhouse Gas Emissions: A Groundbreaking Move Towards Climate Neutrality

Denmark has made history by becoming the first country in the world to tax livestock farmers for the greenhouse gases emitted by their cows, sheep, and pigs. This move is part of Denmark’s ambitious goal to reduce greenhouse gas emissions by 70% from 1990 levels by 2030.

Starting in 2030, Danish livestock farmers will be taxed 300 kroner ($43) per ton of carbon dioxide equivalent, with the tax increasing to 750 kroner ($108) by 2035. However, due to an income tax deduction of 60%, the actual cost per ton will start at 120 kroner ($17.3) and increase to 300 kroner by 2035.

Methane, which is emitted by sources including landfills, oil and natural gas systems, and livestock, is a major contributor to global warming. Livestock alone account for about 32% of human-caused methane emissions, according to the U.N. Environment Program.

Denmark’s Taxation Minister Jeppe Bruus stated that this tax on agriculture will bring the country closer to its goal of becoming climate neutral by 2045. The agreement was reached after negotiations between the government, farmers, industry representatives, and unions.

The Danish Society for Nature Conservation hailed the tax agreement as a “historic compromise” that will pave the way for a restructured food industry beyond 2030. The tax will apply to cows, which produce 6 metric tons (6.6 tons) of CO2 equivalent per year, as well as pigs.

This move by Denmark comes after months of protests by farmers across Europe against climate change mitigation measures. New Zealand had passed a similar law set to take effect in 2025 but recently removed it from the statute book due to criticism from farmers.

The tax bill in Denmark will need to be approved by the parliament, but it is expected to pass given the broad-based consensus. With over 1.4 million cows in Denmark as of June 2022, this tax is a significant step towards reducing greenhouse gas emissions in the country.