Pakistan exempts taxes on import of solar panels

- Pakistani

Pakistan is attempting to promote investment in its growing renewable energy industry.

The government of Prime Minister Nawaz Sharif has announced to exempt customs duty and general sales tax on import of solar panels into the country (Pakistan).

Currently, customs duty is applied at 5%, and the  general sales tax (GST) at 17 per cent is applied to complete solar panels brought into Pakistan.

Now according to Prime Minister Nawaz Sharif’s plan to accelerate in growing energy in Pakistan, local manufacturers will now be able to import free components of solar panel.

There will also be no taxes applied to complete solar panels brought in Pakistan for installation.

This decision is taken to promote the domestic market as well as to enable the manufacturers to fulfil the energy requirements, importing solar panels.

With the introduction of Pakistan’s new Financial budget of 2014-2015, the government had imposed 5 per cent customs duty and 17pc GST on solar panels.

The exemption of taxes on solar panels will reduce the retail price of the complete system.

Chairman Pakistan Solar Association Faiz Bhutta said that the waiver of taxes will lead to a reduction of Rs3,000 per 100 Watt panel. He said the price of 100 Watt panel had surged to Rs11,000 after July 1, 2014 owing to imposition of new taxes.

Moreover, the remaining 50 per cent cost is of the solar battery which includes 20pc customs duty, and 17pc GST, Bhutta said, adding that his association also demanded abolishing of whole duty on solar battery as well.

According to the official, local manufacturers were yet to develop skills to produce international standard solar panels for the domestic market. To improve the standards of the local panels, government has given a deadline of June 30, 2015 to get international quality certifications.

Prime Minister Nawaz Sharif had assigned Finance Minister Ishaq Dar to sort out and settle down all issues concerning import of solar panels.
Pakistan has been importing solar panels from different countries including China and Germany.

Pakistan Solar Association demanded a discount on import of solar batteries as well.