Govt Reduces Solar GST to 10%, Promotes Clean Energy Adoption

ISLAMABAD: In a major relief for the solar energy sector, the government has finalized the reduction in sales tax on imported solar panels from the proposed 18 percent to 10 percent, Deputy Prime Minister Ishaq Dar announced in Parliament today.

The move comes after the National Assembly’s Finance Committee unanimously opposed the 18 percent tax, arguing that it would hamper the pace of solar energy adoption.

Dar said that after consultations with the coalition parties and the FBR, the 10 percent tax was agreed upon to ensure “a balance between revenue collection and renewable growth.”

He further explained that 46 percent of solar panel components were already under the existing tax structure, and the additional GST would only unnecessarily increase the cost.

Clean energy advocates have praised the move, saying Pakistan’s imported solar capacity has increased to about 17 GW in 2024. The lower tax rate is expected to promote wider adoption of rooftop solar power, helping meet national energy conservation goals.