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A world-first emissions tax is going after gassy cattle

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Denmark is set to impose the world’s first emissions tax on livestock from 2030, targeting greenhouse gases emitted by the country’s cows, pigs and sheep.

According to the plan, farmers must pay about $43 per metric ton of carbon dioxide equivalent produced by their livestock. That rate will increase to about $108 in 2035. The levies will be partially offset by a 60 percent tax deduction, rendering them closer to $17 per metric ton in 2030 and $43 in 2035, according to the Danish government, which unveiled the proposed bill this week.

Danish officials project that the tax will cut the country’s emissions by about 1.8 million metric tons of carbon dioxide equivalent in 2030. Humans emitted more than 40 billion tons of carbon dioxide in 2022, according to the MIT Climate Portal.

“We will be the first country in the world to introduce a real [carbon dioxide equivalent tax] on agriculture. Other countries will be inspired by it,” Danish Tax Minister Jeppe Bruus said in a statement. “The agreement shows how much we can achieve when we come together across party colors and interests to find joint solutions to one of the greatest challenges of our time.”

The deal between the center-right government and representatives of groups including farmers, the industry and unions was reached Monday, according to the Associated Press. Farmers across Europe have for months been protesting cuts to subsidies and new regulations, some of them designed to reduce climate-changing emissions, The Washington Post reported.

Proceeds from Denmark’s proposed tax — which is expected to be approved by the country’s parliament as it was written with broad support — for 2030-31 will be returned to the industry to support its green transition, the government said, with the handling of proceeds to be revisited in 2032. The bill also includes the establishment of more than 600,000 acres of new forest areas, among other initiatives.

The tax is aimed at slashing emissions of methane, a greenhouse gas that the U.N. Intergovernmental Panel on Climate Change says must be reduced by 40 to 45 percent by 2030, to cap global warming to 1.5 degrees Celsius this century.

It was also hailed by the Danish government as a way to meet its domestic climate target of lowering greenhouse gas emissions by 70 percent from 1990 levels by 2030.

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Livestock is responsible for about 32 percent of human-caused methane emissions, according to the United Nations. The 1.5 billion cattle around the world are the cause of most livestock-borne methane, according to the organization — though Denmark had less than 0.1 percent of them, according to 2022 figures compiled by Our World in Data. Brazil had a world-high 234 million cattle that year, followed by 194 million in India and the United States’ 92 million.

A similar bill to Denmark’s was under consideration by the previous, center-left government of New Zealand, where the agricultural sector is responsible for half of its emissions — largely due to methane emitted from livestock when they burp. But that plan was axed this month by the country’s new center-right government, partly due to pushback from cattle farmers.

New Zealand has proposed reducing methane from livestock through other methods, such as funding research focused on developing a “methane vaccine” and a project to breed lower emissions cattle, according to a government news release.

The problem with such research is that it hasn’t reached a stage where it is cost-effective for farmers to utilize “at current carbon prices,” said Richard Eckard, a professor of carbon farming at the University of Melbourne in Australia.

But major multinational agricultural companies have set targets for reduced emissions, which will be a more effective mechanism over time to drive change at the farm level “than a straight carbon tax,” he wrote in an email. This would then mean “governments don’t need to be the bad guys” by levying carbon taxes that trigger pushback from farmers, Eckard added.

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