EU Study Supports Meat Tax Reform to Cut CO2 Emissions

Scientists say applying full value-added tax rates to meat products could be a fast, low-cost first step to reduce food-related greenhouse gas emissions in Europe without sharply increasing household expenses or food prices.

Food and agriculture account for about one-third of global greenhouse gas emissions, second only to fossil fuels. A 2023 study published in Nature found that emissions from the way food is produced and consumed could add nearly 1°C of warming to the planet by 2100. Animal-based products, particularly beef and lamb, are among the most emissions-intensive foods, with one 100g serving of beef equivalent to driving 78.7km and releasing 15.5kg of CO₂ equivalent, according to CO2 Everything.

Despite this, 22 of the European Union’s 27 member states apply reduced or zero VAT rates to meat purchases, effectively shielding consumers from the environmental costs of consumption. A new study by the Potsdam Institute for Climate Impact Research (PIK), published in Nature Food, evaluates how removing these tax privileges, or applying a carbon price to food, could reduce environmental damage while limiting social costs.

“From an economic perspective, you should add the production-related environmental costs incurred during production to the price. This would mean that the more CO₂ is emitted, the more expensive it becomes,” said Charlotte Plinke, PIK Researcher and author of the study. 

The researchers found that subjecting meat products such as beef, pork, lamb and chicken to the standard VAT rate would reduce the environmental damage caused by food consumption by between 3.48% and 5.7%, depending on the impact category. In climate terms, this would cut greenhouse gas emissions by 29.9Mt of CO₂e per year, or about 5% of diet-related emissions.

Animal-based products account for the largest share of the EU’s dietary ecological footprint, responsible for nearly a quarter of household greenhouse gas emissions, more than half of biodiversity loss and phosphorus pollution, and almost three-quarters of water consumption. The study found that the environmental footprint of meat is substantially higher than that of plant-based foods across nearly all indicators, with the exception of water use.

Tax treatment varies widely across the EU. Ireland applies zero tax on meat compared with a general VAT rate of 23%. The gap is 20 percentage points in Croatia, 15 in France, 12 in Germany and Italy, and 11 in Spain. Only Bulgaria, Denmark, Estonia, Latvia and Lithuania tax meat at the standard VAT rate.

According to the study, removing reduced VAT rates on meat would increase average annual food spending per EU household by about US$128.02. However, if additional tax revenues were redistributed through per capita payments, the net cost would fall to US$30.54 per household per year.

The researchers also modeled a broader policy option: applying a carbon price of US$61.07 per ton of CO₂ equivalent to food products. This approach would achieve similar emissions reductions while lowering net household costs to about US$14.09 per year, and delivering slightly greater environmental benefits.

“Such a comprehensive price signal would reduce the other environmental impacts, beyond greenhouse gases, even a little more than the selective VAT price signal for meat,” said Michael Sureth, another author of the study.

However, the authors acknowledged that applying a uniform carbon price across the enormous variety of food products consumed in Europe would require complex calculations and political negotiations. As a result, removing VAT exemptions on meat was identified as the most feasible short-term option.

“Our numbers show the policies we investigated can be effective, but they also reveal that we do not yet fully price in the environmental impacts of meat. It is important to have exact information of what the impacts actually are, and then to be transparent about the goals of the policy and the use of revenues.” Plinke said.

The study challenges the long-standing focus on individual dietary choices as the primary lever for reducing food-related emissions. Instead, it points to fiscal policy as a faster and more decisive tool for correcting price distortions that encourage resource-intensive consumption patterns.

Researchers stressed that a meat tax alone would not solve the environmental impacts of food systems, but could serve as a catalyst for broader change. By aligning prices with environmental costs, governments could generate funding for social compensation, support innovation in food production and encourage a gradual shift toward less resource-intensive diets.