Need For Green Taxation Framework In India
- IJLLR Journal
- Nov 13, 2025
- 1 min read
Devansh Kothari, O P Jindal Global University
ABSTRACT
This paper examines the urgent need for a structured Green Taxation Framework in India to balance its rapid economic growth with environmental sustainability. Despite India’s commitment to the Sustainable Development Goals and its adoption of several environmental policies such as the NAPCC, SAPCC and the Compensatory Afforestation Fund Act, its fiscal approach to environmental protection remains fragmented. Pre- existing levies such as the Clean Energy Cess were repealed to make way for the sweeping GST framework and the currently operation levies such as the Motor Vehicle Green Tax are limited in scope and lack a cohesive national framework. The integration of green taxes into the GST regime has diluted their environmental purpose by diverting funds away from sustainable initiatives. Through a comparative analysis of jurisdictions such as the United States, the European Union and China, this paper identifies best practices that India could adopt. It proposes a harmonized green taxation system that internalizes the environmental cost of pollution while ensuring equitable economic growth. The study concludes that a self-sustaining, transparent green tax regime is essential for India to achieve its International environmental commitments and foster long-term economical and environmental sustainability.
