From: EurActiv
Published June 7, 2013 06:12 AM

Denmark's NOx Tax

Denmark's tax on nitrogen oxide emissions, which was raised during the financial crisis, could be scrapped if it's proven to have a negative impact on jobs and competitiveness.

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The centre-left Danish government, which was formed in October 2011, decided at the end of that year to raise the tax from 5 to 25 Danish crowns (from €0.7 to 3.4) per kilo of nitrogen oxide NOx emissions. The tax was introduced on 1 July 2012.

The increased NOx tax was adopted after long debates in the Danish parliament where opposition parties warned it would be expensive not only for companies emitting NOx, but for all businesses.

"This increase will reduce our competitiveness and cost thousands of Danish jobs," argued Torsten Schak Pedersen, spokesperson on tax issues for the Liberals' opposition party.

Another liberal politician, Kim Andersen, worried that an increased tax would affect companies hard-hit by the global financial and economic crisis.

"This is like dealing with a sick guy by kicking him in the stomach and hitting him in the head with a hammer so that he can really feel it," he said told the magazine Ingeniøren.

Last October, the government reversed policies on another controversial tax, having abolished a levy on fatty foods on the grounds that it was hurting the economy and encouraging people to shop in neighbouring Germany. The government also scrapped its plans to introduce a sugar tax targeting sweets and drinks.

Opposition parties worried that the fivefold tax increase wouldn't reduce the amount of NOx pollution in Denmark.

"Figures have shown that 90% of the NOx pollution in Denmark comes from other countries. Besides, the government only wants to put the new tax on stationary installations. Then only half of the NOx pollution in Denmark will have a tax," said Ole Birk Olsen, tax spokesperson for the Liberal Alliance party.

Oil refinery image via Shutterstock.

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