High GST on scrap, e-waste hurting India's circular economy: CSE study
GST
Dated:- 12-8-2025
PTI
New Delhi, Aug 12 (PTI) The steep GST of 18 per cent levied on several crucial waste categories has become an obstacle in the sustainable management of solid waste in India and is also leading to revenue losses of around Rs 65,000 crore, according to a new study published on Tuesday.
\nThe study by think tank Centre for Science and Environment (CSE) finds that small dealers who collect scrap cannot afford an 18-per cent GST, so they keep their transactions cash-based and untaxed.
\nThis not only deprives the government of revenue but also distorts the market, as compliant businesses struggle to compete with tax-evading informal operato<\/p>\n
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Plain text (Extract) only<\/strong> = = = = = = = =<\/p>\n secondary steel and aluminum production, faces this high tax rate, making formal transactions economically unviable for small dealers,” said Subhrajit Goswami, programme manager at CSE. = = = = = = = =<\/p>\n
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\nThis flies in the face of the National Steel Policy, which aims for 40 per cent of India's steel production to come from scrap by 2030. The 18-per cent GST on ferrous scrap makes it economically unviable for small dealers to operate formally. A reduced rate would align the fiscal policy with the country's circular economy objectives, says Goswami.
\nSimilarly, plastic waste, electronic waste and various industrial by-products are subjected to an 18-per cent GST, creating a significant cost burden that pushes operators toward informal, cash-based transaction<\/p>\n