Large amounts of carbon are stored as permafrost within the Arctic and sub-Arctic regions. As permafrost thaws due to climate warming, carbon dioxide and methane are released. Recent studies indicate that the pool of carbon susceptible to future thaw is higher than was previously thought and that more carbon could be released by 2100, even under low emission pathways. We use an integrated model of the climate and the economy to study how including these new estimates influence the control of climate change to levels that will likely keep the temperature increase below 2 °C (radiative forcing of 2.6 Wm−2). According to our simulations, the fossil fuel and industrial CO2 emissions need to peak 5–10 years earlier and the carbon budget needs to be reduced by 6–17 % to offset this additional source of warming. The required increase in carbon price implies a 6–21 % higher mitigation cost to society compared to a situation where emissions from permafrost are not considered. Including other positive climate feedbacks, currently not accounted for in integrated assessment models, could further increase these numbers.