A tax on cow burps. From 2030, Denmark will tax greenhouse gas emissions from livestock at 300 kroner (about 7,200 yen) per tonne of CO2 equivalent. It is the world's first tax to put a price on farming emissions themselves, nicknamed the "cow burp tax." And in the very same month — November 2024 — on the other side of the planet, New Zealand passed a law taking agriculture out of its emissions trading scheme. Denmark agreed to implement the tax on the 18th; New Zealand legislated its withdrawal on the 21st — opposite conclusions in the same week. We sort out how the world's first such tax works, how New Zealand's earlier attempt collapsed, and how it all compares with Japan, where only fossil fuels carry a carbon tax burden — all from primary sources.
How it works: taxing the CO2 equivalent of burps and manure
Formally, this is a CO2e tax on greenhouse gases from livestock (CO2e = methane and other gases converted into CO2 terms). Here is the design agreed by the Danish government and parties on both sides of the aisle.
| Item | Details |
|---|---|
| What is taxed | Greenhouse gases from livestock enteric fermentation (methane from burps) and manure management (calculated using the national emissions inventory) |
| Headline rate | 2030: 300 kroner (about 7,200 yen) per tonne of CO2e, rising in stages to 750 kroner (about 18,000 yen) in 2035 |
| Basic deduction | A 60% deduction against average emissions for each type of livestock. Effective rates are 120 kroner (about 2,900 yen) in 2030 and 300 kroner (about 7,200 yen) in 2035 |
| Use of revenue | For 2030-31, all revenue is recycled into supporting the transition in agriculture (investment in climate technology and production change, focused on cattle and pig farms carrying the heaviest burden) |
| Review | Rates and deductions are to be reconsidered in 2032 (assessing technological progress, international competitiveness and actual reductions. Rates are indexed to prices in 2022 terms) |
The key point is the "60% basic deduction." Because up to 60% of average emissions is not taxed, the real burden starts at 40% of the headline rate. And the deduction is not "60% of that farm's own emissions" but a flat amount per head based on "60% of average emissions for that type of livestock." Farm in a way that emits less than average and you keep more; emit more and you pay more — the incentive to cut emissions stays intact.
How much per cow? The Danish think tank CONCITO estimates that an average dairy cow emits 5.6 tonnes of CO2e a year. At the effective rate, that works out to 672 kroner (about 16,000 yen) per cow per year in 2030, and 1,680 kroner (about 40,000 yen) in 2035.
- Alongside livestock, the package includes a tax on lime spread on farmland (750 kroner per tonne, phased in from 2027) and subsidies for cutting chemical fertilizer use (from 2028)
- The deal was settled through the tripartite talks of June 2024 (see below) and the cross-party political agreement (implementation agreement) of 18 November that year. Legislation is being put in place in stages, with taxation due to start in 2030 (some measures are conditional on EU state aid approval. Please check the Danish government's official information for the latest status)
Why it happened: a livestock powerhouse where 60% of the land is farmland
Denmark is a major exporter of livestock and dairy products, with roughly 10 million pigs against a population of about 6 million, and farmland covering about 60% of its land area — among the highest shares in the world. Its climate law sets an ambitious target of cutting greenhouse gases 70% from 1990 levels by 2030, but with decarbonization of the energy sector well advanced, reports warned that agriculture was on course to account for nearly half of domestic emissions by 2030. With EU reduction obligations (sector-by-sector burden sharing including agriculture) on top, "70% reduction without touching agriculture" simply no longer added up.
A negotiation designed not to be "farmers versus the environment."Denmark did not impose this tax unilaterally. It was agreed over several months in the "Green Tripartite" (Grøn trepart), where the farming sector (the Danish Agriculture and Food Council), conservation groups, trade unions, industry and local authorities sat at the same table. In exchange for the tax, the state set up a "Green Land Fund" worth about 43 billion kroner (about 1 trillion yen) to buy up farmland, plant 250,000 hectares of forest, restore 140,000 hectares of wetland and invest in low-emission technology. The Novo Nordisk Foundation is contributing a further 10 billion kroner (about 240 billion yen).
- The agreement as a whole is expected to cut 1.8 to 2.6 million tonnes of CO2e in 2030 (the tax, lime, afforestation, rewetting and so on combined)
- It is a national project big enough to warrant a dedicated ministry (the Ministry of Green Tripartite), whose minister described it as "the biggest change to the landscape since the wetland drainage of 1864"
- While the major organizations joined the agreement, concerns about higher costs and international competitiveness remain among farmers, so this is not a case of "agreement reached, job done" — scrutiny continues up to the 2032 review
New Zealand went first and gave up: from proposal to repeal
In fact, the first country to attempt "the world's first farm emissions levy" was New Zealand. It has an unusual profile in which roughly half of emissions come from agriculture. In 2019 it launched He Waka Eke Noa, a joint programme between the government and farming groups, and in October 2022 announced the world's first plan to "charge each farm a levy based on its emissions from 2025." But from there the tide turned.
- 2022: fierce pushback from farmers.Protests blocking main roads with tractors broke out around the country, and concern spread about "cutting herd sizes and pushing production overseas (so emissions would simply move to another country)"
- 2023: a change of government.The election was won by a bloc that campaigned on taking agriculture out of the emissions trading scheme (ETS)
- 11 June 2024: withdrawal announced.The new government announced it would disband He Waka Eke Noa and remove agriculture from the ETS, saying "New Zealand farmers are the most carbon-efficient food producers in the world"
- 21 November 2024: the law passed.The amendment removing agriculture from the ETS was enacted. In its place, a new consultative body with industry groups was created, with 400 million NZ dollars (about 35 billion yen) over four years invested in commercializing emission-reduction technology (plus a separate 50.5 million NZ dollars for methane-suppressing vaccines, breeding low-emission cattle and inhibitor research)
Denmark's implementation agreement (18 November) and New Zealand's repeal legislation (21 November) were just three days apart. What divided them was design — "how to bring farmers along" and "tax versus technology support" — and it is not a simple matter of one being right and the other wrong. Denmark recycles its tax revenue into technology investment, and New Zealand has kept its reduction targets. The means differ, but the destination is the same: cutting emissions from livestock farming.
Around the world: Denmark is still the only adopter
As of August 2026, Denmark is the only country to have decided on a system that taxes farming emissions themselves. But the debate continues in many places.
- EU: the emissions trading system (EU ETS) covers power generation, industry, aviation and so on, and does not include biological emissions from agriculture. How to treat farm emissions is one of the issues for the next climate target (2040), with both calls to consider pricing (taxes or trading) and voices worried about food security and the burden on farmers
- Ireland: a big livestock country where 37.9% of emissions come from agriculture (2024, Environmental Protection Agency). Law sets a ceiling requiring "a 25% cut in the agriculture sector by 2030 against 2018," but the means are technology and better farming practices rather than taxation, and the EPA projects that current measures will fall short of the target
- New Zealand: as described above, the tax was scrapped in favour of a technology development route. The biogenic methane reduction target (10% down by 2030) does remain in law
On the subject of "taxing food," Denmark is also the country that introduced a "fat tax" on saturated fat in 2011 and abolished it after just 15 months, amid cross-border shopping and other problems (we cover the story in detail in successes and failures of health taxes around the world). The complex design of this burp tax — "a tax on farmers plus deductions plus recycled support" rather than a mark-up on retail prices — is said to reflect lessons learned from that failure.
Compared with Japan: Japan's carbon tax covers "fossil fuels only"
Japan does tax carbon, but the coverage is entirely different.
| Denmark (burp tax) | Japan | |
|---|---|---|
| System | CO2e tax on livestock emissions (from 2030) | Tax for Climate Change Mitigation (from 2012) plus new GX-related schemes |
| What is taxed | Greenhouse gases from livestock burps and manure | Only fossil fuels such as oil, natural gas and coal |
| Rate (per tonne of CO2) | Headline 300 to 750 kroner (about 7,200 yen to 18,000 yen); effective 120 to 300 kroner | 289 yen (climate change tax) |
| What comes next | Rates and deductions reviewed in 2032 | Emissions trading (GX-ETS) starts in earnest for large emitters from fiscal 2026, and a fossil fuel levy from fiscal 2028 (charged on importers and others) |
| Farming emissions (methane etc.) | Taxed | Not covered (reductions pursued through technology and subsidies, not taxation) |
- Japan's climate change tax is 289 yen per tonne of CO2, and the burden on households is estimated at around 100 yen a month on average (Ministry of the Environment). The level is low compared with Denmark's general carbon taxes or this new farm tax, but the coverage and purpose of the taxes differ, so a simple better-or-worse comparison is not possible
- The fossil fuel levy starting in fiscal 2028 also applies to fossil fuel importers and the like, and biological emissions from agriculture (methane from burps or from paddy fields) are not taxed under any of these schemes
- Agriculture, forestry and fisheries account for about 4% of Japan's greenhouse gas emissions, with energy-related CO2 dominating (a very different picture from New Zealand, where nearly half of emissions come from farming). Within that share, methane from paddy fields and livestock is the main source, and the Ministry of Agriculture, Forestry and Fisheries has set a goal of zero emissions by 2050 under its "Strategy for Sustainable Food Systems," working along a "technology, not taxation" route such as developing feed and breeds that cut methane. In direction, that is closer to the New Zealand model
What it means for people in Japan: what happens to beef and dairy?
"If you tax cows, won't beef and milk get more expensive?" is the question everyone asks first. Danish explanations estimate the impact as follows.
- The effect on the retail price of minced meat is put at about 2 kroner (about 50 yen) per kg as of 2030 — with discount-store mince at about 70 kroner (about 1,700 yen) per kg, that is an increase of just under 3% (as reported from the Danish economy minister's explanation)
- Across meat and dairy as a whole, estimates reported put the price rise at around 2% on average. Because the basic deduction holds the effective burden to 40% and revenue is returned to support production change, pass-through to retail prices is expected to be limited
- Denmark is a major exporter of pork and dairy, and Danish pork, cheese and butter are on the shelves of Japanese supermarkets too. From 2030 there may be a slight effect on import prices, but swings in exchange rates and feed prices are far larger in practice
- There are no plans to introduce a "cow burp tax" in Japan as of August 2026. When it comes to tax debates that move Japanese food prices, the debate over consumption tax on food has a far more direct effect on household budgets
One thing worth noting: it would be inaccurate to read this tax as "farmers are the villains, so we tax them." Denmark's design pairs the tax with a fund on the order of 1 trillion yen to support farmers who make the transition — a carrot-and-stick combination. How to reconcile food production with climate policy is not someone else's problem for a Japanese dinner table that depends on imported food.
References (sources)
* Figures are based on published materials and reporting as of August 2026. Yen conversions use approximate rates of 1 Danish krone = 24 yen and 1 NZ dollar = 88 yen. Denmark's tax is due to start in 2030, and details may change depending on how implementing legislation develops. This article is informational and does not argue for or against any particular policy. For individual tax decisions, consult a tax office or tax accountant.
