India is the fifth largest producer of electronic waste (e-waste) across the globe. We generate 1.85 million tonnes of electronic waste annually. Under the Goods and Services Tax Regime (GST), e-waste industry has not been properly defined by the government under any of the GST slab rates.
Currently, in India, there are more than 1 billion mobile users, 57 million users of computers, desktops, laptops, and millions of people are using other electronic gadgets. As per Assocham and KPMG’s research study, it is revealed that only 1.5% of e-waste produced in this country gets recycled.
Akshay Jain, Director of Namo e-waste, said, “GST rate on scrap is 18% and for computer and electronics, it is 28%. There is no mention of e-waste or computer IT scrap in the list of items under GST and hence, there’s no clarity.” He further added, “We are not able to find the item code for our category. Different electronics are scheduled under different rates of GST.”
Presently, e-waste players have to pay an additional 10% tax on electronic gadgets and can claim for refund from the government after 90 days which makes the entire situation complex. Jain also said that India is ranked fifth in the list of countries producing e-waste and also considered a major importer of e-waste from renowned regions such as China, European Union and the USA. The GST Council must clarify GST rates for the e-waste sector. The data figures are revealed by the joint study of KPMG and ASSOCHAM.
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Prabir Chetia, the head of Business Research & Advisory at Aranca Global Research Firm, said, e-waste has not been included in the GST slab rate which indicates that the industry has been ignored.
“The GST rate is clearly defined for a very limited range of electronic scrap or waste, which comprise certain types of cells, batteries, and accumulators, and the applicable rate is 18%. Further, GST rate for electronic products varies from 5% to 28%, depending on the type of electronic product.”
“The company that is recycling scrap will now have to pay 18% GST, which will lead to the cost being passed down, thus heavily affecting the waste-pickers. Earlier, if they were given Rs. 118, today they will earn only Rs. 100. Instead, they will prefer going to the kabadiwalas, which will not include these taxes,” said Bharati Chaturvedi, Director Chintan Environmental Research and Action Group.
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“If these rates continue, in the long run, recycling is bound to slow down, leading to e-waste being rendered useless. This chain will eventually lead to more toxic fumes as well as increased poverty.”
