India is considering cutting its import tax on solar panels by half and is seeking a rollback in goods and services taxes on the devices to make up a shortfall in local output amid rising demand for renewable energy, three government sources said. India’s renewable energy ministry has held talks with the finance ministry to approve its request to cut the import tax on solar panels from 40% to 20%, said the three sources, who declined to be identified as the decision has not yet been finalised.
Also, the two ministries may make a recommendation to India’s Good and Services Tax Council to lower the goods and services tax (GST) on solar panels to 5%, from the 12% imposed in 2021, the sources said. India’s finance ministry did not respond to a request for comment. A spokesperson for the renewable energy ministry said via a text message “there is no such proposal”. He did not elaborate further or comment on the internal discussions.
