The move seeks to help the European country meet its climate goals by addressing the largest source of emissions in Denmark, agriculture. The country is a major exporter of pork and dairy products, and these economic incentives help keep emissions high.
While farmers are disturbed and fear the financial trouble will hurt their livelihoods, the government plans to spend billions in environmental projects.
Protests are expected as tensions increase between agricultural interests and climate initiatives.
A normal Danish cow produces six metric tons (6.6 U.S. tons) of carbon emissions each year. As reported by Statistic Denmark, there were as of June 30, 2022, 1,484,377 cows in the Scandinavian country, a small decline in comparison to the past year.
Normal Danish cow produces six metric tons of CO2 equivalent yearly
Denmark’s coalition government decided to enforce the first carbon emissions tax on farmers worldwide and it will require new cattle taxes starting in 2030. Denmark’s 179-seat Folketing, or parliament, is expected to pass the bill easily, as it has received widespread consensus even among the opposition. (Related: Denmark to tax livestock farts and burps starting in 2030.)
The proposal also comes with a pledge to invest 40 billion kroner ($5.8 billion) in initiatives such as reforestation and the establishment of wetlands.
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“With today’s agreement, we are investing billions in the biggest transformation of the Danish landscape in recent times,” Danish Foreign Minister Lars Lokke Rasmussen said. “At the same time, we will be the first country in the world with a [carbon] tax on agriculture.”
Most of the Danish dairy industry welcomed the agreement and its goals but some farmers are worried about it.
The action was taken only several months after farmers organized protests throughout Europe, using tractors to block highways and throwing eggs at the European Parliament in answer to a list of grievances in addition to environmental laws and excessive red tape.
The tax, which is expected to be adopted later this year, will begin in 2030 and rise to 750 kroner ($110) in 2035 per tonne (1.1 ton) of carbon-equivalent emissions from cattle.
Farmers will basically be charged 120 kroner ($17.5) per tonne of animal emissions yearly beginning in 2030. And with the tax credit of 60 percent being applied this will rise to 300 kroner ($44) in 2035.
The Baeredygtigt Landbrug organization of Danish farmers alleged that the actions were equal to a “scary experiment.”
“We believe that the agreement is pure bureaucracy. We recognize that there is a climate problem… But we do not believe that this agreement will solve the problems because it will put a spoke in the wheel of agriculture’s green investments,” chairman Peter Kiær said in a statement.
Peder Tuborgh, the CEO of Arla Foods, the biggest dairy company in Europe, called the agreement “positive,” but he stressed that farmers who “genuinely do everything they can to reduce emissions” shouldn’t have to pay a tax.
“It is essential that the tax base for a [carbon] tax is solely based on emissions for which there are means to eliminate [them],” Tuborgh added.
Kristian Hundeboll, the CEO of DLG Group, a cooperative owned by 25,000 Danish farmers and one of the biggest agricultural companies in Europe, said that the tax’s “anchoring” in EU law was “crucial for competitiveness.”
“Neither the climate, agriculture nor the ancillary industries benefit from Denmark acting unilaterally,” Hundeboll stated.
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