Demand side differential taxation of products high in GHG

This solution was shared by IFSS portal research team , 09 June 2022

Print date: 04 October 2022 09:55

Description of the innovative solution

Circular economy Closing nutrient loop Finance Consumer choice Fats - sugars - salts Animal-sourced food Food environment - personal Food environment - external Food literacy Double-duty action Investment fund Waste

The food system is responsible for more than a quarter of all greenhouse gas (GHG) emissions, most of which are related to livestock. In order to incentivize emission reductions, climate policies covering the energy factor usually envisage the pricing of GHG emissions at source, instead of targeting the consumption side. Most of the agricultural GHG emissions are related to intrinsic characteristics of the agricultural system, such as methane emissions from ruminants and nitrous oxide emissions from fertilizers, but climate-mitification options that balance agricultural output and food availability do exist. This innovation proposes demand-side policies as a viable option for addressing the environmental cost associated with food production. Levying GHG taxes on the consumption side instead of the production side has been argued to be an economically preferable approach, given the nature of agriculture described above. In addition, measures to change diets away from emission-intensive food commodities, such as meat and dairy, towards more plant-based diets are seen to offer great potential for reducing GHG emissions. Furthermore, if the health-critical food groups, such as fruits and vegetables were exempted from taxation, these measures could be associated with additional co-benefits in terms of improvements in human health.

Supply chain segment

Waste

Maturity level

Prototype

Criteria

Food desirability Climate mitigation Climate adaptation

SDG target

SDG 3: Good Health and Well-being SDG 12: Responsible Consumption and Production SDG 13: Climate Action

Context

Urban Peri-urban Rural

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Emissions pricing of food commodities
Scientific paper
This article analyzes through mathematical models the potential mitigatory effect of emission pricing of food commodities on environmental issues.
Shared by Silvia Martinez IFSS Research Team

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