The non-inclusion of diesel and non-fixed fertiliser rates shows GST is not environmental friendly.
What are the serious environmental issues with GST?
The commodity value chain is inseparably linked to a more fundamental production process i.e the ecological production process.
Goods and services provided for free to human communities by the ecosystem also comes under taxable product.
The GST imposed on commodities that are pivotal to livelihoods for forest tribes in India might not be too beneficial for the value-chain either.
Infrastructure - GST will bring about more transportation of goods and demand for infrastructure.
If road infrastructure growth brings about reasonable land use conversions without factoring in ecological concerns, the net result may not be ecologically favourable.
Clean energy - Diesel is not clean fuel and it does not comes under GST taxation, but under proposed structure there is 5% tax on solar and wind energy.
The carbon tax (or coal cess), which was thought to be a source of funding for clean energy projects through the National Clean Energy Fund, will now feed the GST Compensation Fund — a fund meant to compensate various state governments for any loss in revenue arising out of the goods and services tax.
With the costs for coal projected to fall by almost 7%, the GST regime clearly moves the “terms-of-trade” in favour of coal from the cleaner sources of energy.
Chemicals - On the other hand, a 12% GST on fertilisers, up from the 4-8% rates escalates the prices of fertilisers.
As per certain estimates, the prices for urea, the most commonly used fertiliser, may increase by Rs. 300 to Rs. 400 per tonne.
Most States did not levy any value-added tax (VAT) on micronutrients, organic manure and bio-fertilisers, the 12-per cent GST rate will mean a rise in retail prices of these minor fertilisers.
Tobacco -The tax on tendu leaf, a Minor Forest Produce (MFP) used to roll beedi, which is the financial lifeline of many tribes of Central India is now set at 18%.
When the government has already imposed 28% on finished beedi with the health concerns with tobacco consumption looming large.
The 18% GST on collected tendu leaf selling goes against the fundamental essence of equity under which Forest Rights Act (FRA) of 2006.
This act exempted incomes obtained from sale of non-timber forest products from taxation.
GST on tendu leaves is akin to taxing ecosystem services, which provide livelihood to poor.
