Evaluating the environmental effects of taxes and subsidies on animal and plant proteins in Scotland using home scan data

To achieve its ambitious climate targets, it is likely that Scotland will have to shift the food consumption of households away from animal proteins. This paper analysed the effectiveness of taxes and subsidies on animal and plant proteins in improving the environmental sustainability of protein consumption in Scotland. It was found that taxes on animal proteins alone struggle to shift consumption towards plant proteins. However, plant protein subsidies achieved dietary shifts toward plant protein categories. The study also highlighted that a blanket tax on all animal proteins, while most effective in reducing total environmental impact of protein consumption, could result in significant negative nutritional and distributional outcomes; thereby reducing the tax’s viability as a policy option. The study concludes that a combination of select taxes and subsidies, along with a mix of alternative policy options, are best suited to shifting Scottish diets in a more environmentally and socially sustainable direction – however, to achieve the Climate Change Committee’s dietary recommendations a mixture of policy levers will likely be required. The study used 2021 home scan data from Kantar Worldpanel and the Exact Affine Stone Index demand system to estimate Marshallian elasticities for protein categories in Scotland. These were used to simulate a range of ad valorem fiscal policy scenarios, which were then evaluated for their impact on greenhouse gas emissions, land use, nutritional intake and welfare.