Animals such as cows and sheep release greenhouse gases through burping, farting, and excretion. In 2022, New Zealand made headlines as the first country to introduce a "cow fart tax," but it was canceled in June 2024 due to farmer dissatisfaction. Denmark, a major exporter of pork and dairy products, has now taken up the mantle.

In late June 2024, Denmark reached an agreement to implement a carbon tax on livestock starting in 2030. Under this plan, each dairy cow will incur a cost of approximately NT$3,100 annually. The agreement is comprehensive, including not only the "cow fart tax" but also initiatives for wetland restoration, soil management, reforestation, and the establishment of funds. With bipartisan support, it is expected to pass parliamentary review, making Denmark the first country in the world to impose an agricultural carbon tax.

NT$3,000 Per Cow: Slight Impact on Prices

Denmark has set a climate goal to reduce greenhouse gas emissions by 70% by 2030. Agriculture is Denmark’s largest source of carbon dioxide emissions, making carbon reduction a significant challenge. After five months of negotiations among the government, farmer groups, and conservation organizations, a historic agreement was reached.

According to Reuters, starting in 2030, each metric ton of agricultural carbon emissions will be taxed 300 kroner. This will increase to 750 kroner by 2035.

However, the government will provide a 60% tax reduction, so the actual carbon fees will be 120 kroner in 2030 and 300 kroner in 2035, with additional subsidies to assist farmers in transitioning to greener practices.

CNN cited analysis from Denmark’s green think tank, Concito, which estimates that a dairy cow, which emits an average of 5.6 metric tons of CO2 annually, will pay about 672 kroner per year after tax credits in 2030.

Currently, the retail price of ground beef at discount stores is around 70 kroner per kilogram. It is anticipated that the new tax will lead to an increase in beef prices. Denmark's Minister of Economic Affairs, Stephanie Lose, stated that by 2030, the price of ground beef might rise by 2 kroner per kilogram.

CNN reported that the government plans to use the tax revenue from the first two years to help farms transition, such as by altering cattle feed. The Danish farmer group Bæredygtigt Landbrug views these measures as a “terrifying experiment,” while Europe’s largest dairy company, Arla Foods, supports the agreement but believes that farmers who have already made efforts to reduce carbon emissions should not be taxed.

Rewilding Soil and Reforestation

In contrast to New Zealand’s failed "cow fart tax," agricultural investment media Agri Investor considers Denmark’s proposal to be more comprehensive, receiving bipartisan support and including biodiversity, reforestation, and water protection measures.

Agricultural carbon emissions are not solely from cattle. Marshes, lakes, river valleys, and grasslands converted to agriculture also contribute to carbon emissions. Denmark plans to rewild these lowland areas with organic soil.

The Copenhagen Post reported that landowners who use pesticides, engage in forestry, or disturb carbon-rich agricultural soils will also be required to pay carbon fees. The agreement includes a fund of 40 billion kroner for supporting soil rewilding and planting 250,000 hectares of forest, with 100,000 hectares of new forests being set aside from commercial forestry.

Denmark’s success in reaching this agreement is attributed to the "Green Tripartite," a platform consisting of the government, non-governmental organizations, and nature and agricultural groups. This negotiation platform was established to address high agricultural carbon emissions, land management, and natural and drinking water resource issues.

Reference:
*CNN（2024/6/26），World’s first carbon tax on livestock will cost farmers $100 per cow

*Copenhagen Post（2024/6/25），Denmark announces world-first climate tax on agriculture – earmarks billions for rewilding

*Reuters（2024/6/25），Denmark will be first to impose CO2 tax on farms, government says

*Agri Investor（2024/7/3），'Burp tax' goes belly-up in NZ as Denmark eyes 2030 intro

Source: Environmental Information Center