Accounting for India's Forest Wealth - Madras School of Economics

State Finance Ministers, The Task Force of Thirteenth FinanceCommission and the model GST recommended by the Thirteenth FinanceCommission, in all cases there is a clear recognition of the need forenvironmental taxes, an reference has been made to demerit goods/singoods/environment (polluting) goods.The Thirteenth Finance Commission has made reference to threeforms of environmental taxes” Non-rebatable excise duties, cesses, anduser charges. These three forms of environmental taxes can be used toserve different purposes. Non-rebatable excises add to overall GST level,and this should be used to at least partially reduce the core GST rate.Cesses should be earmarked for environment promoting activities inindustries to cover cost of specific publically provided environmentalservices were beneficiaries are identifiable..REFERENCESBallard, C. L and S.G. Medema (1992), The Marginal Efficiency Effects ofTaxes and Subsidies in the Present of Externalities: AComputational General Equilibrium Approach, East Lansing MI,Michigan State University.Ballard, C.L. and Don Fullerton (1992),.Distortionary taxation and theprovision of public goods. Journal of Economic Perspectives,6:117–131,Baumol, W.J and Oates, W.E (1988), The Theory of Environmental Policy,(2nd Edition), Cambridge, Cambridge University Press.Bovenberg, A. Lans and Lawrence H. Goulder (1996), “OptimalEnvironmental Taxation in the Presence of Other Taxes: General-Equilibrium Analyses”, The American Economic Review, Vo. 86(4), September, 985-1000.Bovenberg, A. Lans and Ruud A. de Mooij (1994), “Environmental Leviesand Distortionary Taxation”, American Economic Review, 84,1085-9.38