Assuming following code part in md file :

Some equation here
\begin{equation}
x = y
\end{equation}
where $x$ is something important

In tex file I should get same result without any new line after equation block. Because it's breaking identation rules used in latex. And no, \noindent[ #894] is not a solution, because it ridiculous.

Even worse:

The formula
\begin{math}
x = y
\end{math}
should be inline.

This gets output as 3 paragraphs. The math environment is equivalent to \( or $ in Latex documents.

It seems like Pandoc has a general problem with handling new lines when translating Markdown to Latex. If I recall correctly, this is a limitation of the current Pandoc AST, so it can't be fixed using a filter. Perhaps an attribute could be added to Block elements?