Humanity has made significant progress in overcoming some of its greatest challenges, including disease, hunger, and poverty. However, climate change now threatens to reverse this hard-earned progress. Since the Paris Agreement in 2016, the world has continued to grapple with these challenges, leading to unprecedented levels of global debt and a cost-of-living crisis. If the global community could unite in creating a sustainable food system, we could simultaneously address all these threats. This collective action, driven by a simple yet powerful idea, could change the world: the implementation of an environment tax or a carbon tax pricing mechanism in supermarkets.

The food system represents 16–20 percent of global GDP, generating approximately $14 trillion in revenue, with a staggering 70 percent of that concentrated among just 0.06 percent of all companies. It is responsible for one-third of global carbon emissions and nearly half of total methane emissions. The real tragedy, according to the World Bank, lies in the hidden costs associated with the system, estimated at $6 trillion annually. These costs stem from issues like land degradation and the economic losses tied to the 2 billion people who are malnourished. Addressing these problems requires systemic change, which can be driven by empowering consumers through their purchasing decisions.

Ideas alone are insufficient to overcome the hurdles we face. The solution lies within reach of everyday consumers at the checkout register. Critics argue that grocery taxation disproportionately affects low-income consumers. However, according to the Tax Foundation, studies suggest that exempting groceries from sales tax often has the opposite effect, with the lowest-income households experiencing increased tax liability due to the lack of grocery taxation.

Public perception of grocery taxation is controversial, but implementing a comprehensive tax alongside reductions in income tax or credits to the vulnerable could enhance economic efficiency while shifting the burden of change to the companies most responsible for environmental degradation. This wouldn’t be a typical grocery tax but a dynamic one based on the carbon emissions of each product. This system could drive meaningful action across the entire food system.

The implementation of carbon pricing in supermarkets would involve mandatory carbon labeling on all products. This would include calculating the greenhouse gas emissions associated with production, transportation, and disposal. Supermarkets could then incorporate this carbon pricing directly into the product’s price.

Ideas alone, without collective and coordinated action, are insufficient to overcome the hurdles we face.

The revenue generated from this carbon tax could be allocated in several ways, such as supporting local producers, funding carbon offset programs, or providing grocery credits for low- and middle-income consumers who choose green-labeled products. The methodology and international organizations needed to enable carbon accounting or carbon labeling, such as the Science Based Targets Initiative, already exist. Introducing a carbon tax at supermarkets would accelerate the necessary global action to achieve the 1.5-degree Celsius target by compelling private and public sectors to commit to net-zero emissions—an action they must do anyway, according to an IPCC report.

As a CEO of a food manufacturer with factories in several countries, I can attest that compliance with various standards is a normal part of operations. Following an established method to measure greenhouse gas emissions is far easier than persuading thousands of farmers to use fewer chemicals that might reduce their crop yields. The former requires consumer and supermarket willingness to accept higher prices, while the latter imposes burdens on those most at risk of earning below a living wage.

While some may think this shift would take decades, the reality is that the 0.06 percent of companies that control the global food system are accustomed to adapting to evolving standards from regulatory bodies. Manufacturers are typically given 18–24 months to implement changes, so this transition is entirely feasible.

If implemented effectively, consumers would likely support this tax, especially as middle- to upper-income consumers are generally willing to pay a premium for sustainability, PwC reports, while lower-income consumers could benefit from incentives to purchase greener products. Producers would be rewarded for sustainability, and conglomerates that refuse to adapt to a world of true cost of food accounting would face financial consequences, according to Sustainable Food Trust. A straightforward carbon tax at the supermarket checkout could have profound global impacts, helping to achieve the critical goal of limiting global warming while empowering the consumer.