Green Taxation in India: Evaluating the Role of Environmental Taxes in Promoting Sustainable Economic Growth

Anupama Kandanga; Harshita Singh Solanki; Shanya Shree; Simran Saraswati; Tejaswini S

Green Taxation in India: Evaluating the Role of Environmental Taxes in Promoting Sustainable Economic Growth

Author(s)	Ms. Anupama Kandanga, Ms. Harshita Singh Solanki, Ms. Shanya Shree, Ms. Simran Saraswati, Dr. Tejaswini S
Country	India
Abstract	Although often overlooked, financial tools tied to ecological costs now play a central role in shaping how nations respond to worsening environmental conditions. For India, swift expansion in manufacturing and city infrastructure - combined with strong reliance on non-renewable energy sources - has worsened pollution levels, notably increasing greenhouse gases and poor air quality across regions. To understand whether tax-based solutions help long-term progress, an evaluation was carried out focusing on national practices related to eco-sensitive charges. Rather than gathering new information, the approach used existing publications: official statistics, global agency analyses, and regulatory records were reviewed systematically to examine outcomes linked to policies like carbon-related fees on coal, pricing adjustments for petroleum products, and similar revenue-generating regulations meant to protect natural systems. Evidence suggests green taxes in India brought notable income for public finances, pointing toward partial validation of the “double dividend” idea. Still, shifts in industry and household behavior appear minimal despite these measures. Emissions grow steadily even if they climb at a slowing pace over time. Some areas react more than others - vehicle production adjusts faster than factory operations do. Inconsistent enforcement weakens outcomes, along with how collected funds are used, limiting ecological benefits. The findings suggest green taxes in India could drive lasting economic change, yet today they mainly serve income goals. To better protect nature without disrupting growth, policy must shift toward shaping public choices through smarter design. Instead of prioritizing state earnings, future models might align incentives with long-term ecological balance
Keywords	Green Taxation, Environmental Taxes, Sustainable Economic Growth, Carbon Emissions, Double Dividend Hypothesis, Fiscal Policy in India
Published In	Volume 8, Issue 2, March-April 2026
Published On	2026-04-01

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Green Taxation in India: Evaluating the Role of Environmental Taxes in Promoting Sustainable Economic Growth

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