Denmark plans to tax milk and meat production – News

In Denmark, the incentive tax is intended to reduce greenhouse gas emissions. The project has good prospects.

This is about: Denmark wants to become the first country in the world to tax meat and dairy production. So companies will be asked to pay for the greenhouse gases they emit. This tax will be applicable only from 2030 onwards. The plans aim to help Denmark reduce its greenhouse gas emissions by 70 percent by 2030 compared to 1990 levels. Danish agriculture is responsible for 35 percent of the country’s emissions.

It goes like this: A proposal presented by the Minister of Taxation and yet to go through Parliament has been given a good chance in Denmark. Farmers are therefore projected to pay the equivalent of around 40 euros per tonne of CO₂ produced in 2030, rising to around 100 euros in 2035. In return, farmers would receive income tax relief, so the effective burden would be around 15 to 40 euros per tonne of CO₂.

Constructive Approach: In Denmark, there has been a long-standing debate about how to reduce greenhouse gas emissions, says Lukas Fessenfeld. The Political Economist at ETH Zurich There has long been concern about how consumption of animal products can be reduced. So the debate in Denmark is very constructive with everyone involved – in contrast to the Netherlands, for example, where the debate is very polarised. “In Denmark, for example, farmers are being shown new opportunities to produce plant-based proteins,” says Fessenfeld.

Incentive taxes are intended to reduce the consumption of goods that have a particularly large impact on the environment.

Target line: For such a tax to be acceptable, Fessenfeld emphasizes that it is important that the purpose of the tax be clearly communicated. In addition, such so-called incentive taxes are intended to control and change the behavior of producers and consumers: the proceeds of the tax are returned equally to everyone, or money flows back to the affected industry with high climate demand. Friendly production.

Incentives work like this: The idea behind incentive taxes is that they reduce the negative effects of food production. Products with particularly negative effects on animal welfare or climate impact are priced; This makes it less attractive to consumers, but also to manufacturers and distributors. “Incentive taxes are intended to reduce the consumption of goods that have a particularly large impact on the environment,” says economist Fessenfeld.