Demand for Green Tax

Published: 27th April 2015 06:03 AM  |   Last Updated: 27th April 2015 06:03 AM   |  A+A-

BHUBANESWAR: The State Government has renewed its demand for Green Tax in a bid to pressurise the Centre for agreeing to the proposal as a condition for its support to the Goods and Services Tax (GST).

While Chief Minister Naveen Patnaik had written to Prime Minister Narendra Modi in this regard, Finance Minister Pradip Amat raised the issue again during the Empowered Committee meeting of the finance ministers in New Delhi recently.

The BJD MPs, during their speech in the Lok Sabha, also demanded that Green Tax should be introduced. The State Government maintains that though Odisha is a mineral-rich State, a major share of its minerals are either sold to other States or used in production of goods which are sold to other States.

Under GST, the destination principle applies and the mineral-producing State, where pollution might be localised, does not get any part of the revenue. It is only the consuming State that gets the tax revenue whereas the pollution is suffered by citizens of the producing State.

The Finance Minister said taking into consideration the adverse environmental impact, the State Government has demanded an additional tax which it should be empowered to levy subject to suitable framing of guidelines. “There should be a new entry in the Seventh Schedule to the Constitution, State List as 54 B - Other Polluting Goods and Services to be notified by GST Council,” he said.

The State Government has also demanded that States should be allowed to levy tax on tobacco and tobacco products. In the Bill, the Centre’s power to tax tobacco and tobacco products has been retained. Amat said tobacco and tobacco products should be included in entry 54 of the State List to enable States to levy higher rate of tax on it.

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