As governments double down on climate targets and corporate accountability ramps up, the food industry is bracing for impact. One of the most hotly debated (and poorly understood) mechanisms in play? Carbon taxes. Already a staple in sectors like energy and transport, carbon taxes are now edging toward our plates.
So, what does this mean for food businesses, and how can you prepare? Let’s break it down.
Food systems are responsible for 34% of global greenhouse gas emissions. Yet, they’ve largely escaped direct taxation on those emissions—until now.
Several reports indicate growing interest in introducing carbon pricing schemes for food, targeting high-emission categories like red meat and dairy. Meanwhile, academic research suggests that taxes tied to the carbon intensity of food products could help reduce emissions and promote more climate-smart choices across supply chains.
The shift toward carbon taxation is also influenced by the EU’s Corporate Sustainability Reporting Directive (CSRD). Under CSRD, large food businesses will be required to report Scope 1, 2, and 3 emissions—including those from purchased goods and services (i.e., food production).
Suddenly, understanding the carbon footprint of your dishes isn’t just a “nice-to-have.” It’s about future-proofing your business.
The short answer? It depends.
Evidence from countries that have trialed food-related carbon pricing (like Denmark and Sweden) shows modest but meaningful reductions in emissions, especially when paired with consumer-facing tools like carbon labeling.
But a tax alone won’t cut it. According to some reviews, carbon taxes should be combined with behavioral nudges, public awareness, and software-based tools that help businesses and consumers understand the impact of their food choices.
This is where carbon footprint calculators, eco labeling for restaurant menus, and low carbon menu planning tools come in.
If you’re running a food business, carbon taxation could soon hit your bottom line—or give you a competitive edge.
Here’s what to expect:
With CSRD and other regulations pushing for greater transparency, businesses will need to track and disclose emissions across their operations. A carbon emissions calculator for dishes or a sustainable menu carbon calculator will become essential for compliance—not to mention customer trust.
More businesses will use carbon footprint software to redesign menus with low-emission ingredients. Not only to avoid potential taxes, but to tap into growing demand for climate-friendly food business practices.
We may also see a carrot-and-stick approach: higher taxes on high-emission meals, paired with incentives for sustainable food choices, verified through carbon footprint labels or green carbon footprint calculators.
Rather than waiting for legislation to land, forward-thinking food businesses are already using tools like:
• A carbon footprint tracker to monitor dish-level emissions
• A food emissions calculator to guide sourcing and procurement
• A carbon labeling solution to educate diners and influence demand
If you’re not yet calculating or communicating your food’s climate impact, now’s the time. The cost of inaction could be far greater than the cost of adaptation.
Carbon taxation is coming to the food industry—whether through direct taxes, regulatory frameworks like CSRD, or indirect market pressures. And when it does, the businesses that are already tracking, reporting, and reducing their emissions will be the ones ahead of the curve.
Klimato offers a carbon accounting software suite designed specifically for food businesses—making it easy to measure, label, and reduce the carbon footprint of your menu. Curious how it works? Try our calculator or book a demo today.
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