Coronavirus Reveals The Truth About Denmark’s Costly Carbon Tax

  • Date: 29/05/20
  • Bloomberg

Denmark will not consider how to raise taxation of greenhouse gas emissions until fall because of the current economic uncertainty, Minister for Climate, Energy and Utilities Dan Jorgensen says.

In 2019 Denmark set itself some of the world’s most ambitious environmental goals; they include a 70% reduction in greenhouse gas emissions by 2030, compared to 1990 levels. The EU’s target, by contrast, is for a 40% reduction by 2030, an objective that Jorgensen has said is not sufficiently ambitious.

It will be impossible to reach the country’s goal without looking at a fundamental overhaul of the Danish economy that puts a larger price on pollution, Jorgensen said in an interview Wednesday, but “the middle of an unprecedented crisis where thousands and thousands of Danes are losing their jobs, and companies are closing down” is not a good time to raise taxes.

A report released in March by the government-appointed Danish Council on Climate Change recommended increasing carbon taxation, but Jorgensen said that a tax covering the whole of society would be extremely complex and that there is no such model out there that is ready to implement.

The government is planning a broad overhaul of its tax system, he said, but this has been sidetracked by the coronavirus crisis.

“Like [boxer] Mike Tyson said, everybody has got a plan until he gets hit in the face,” said Jorgensen. “That’s what happened to us.”

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