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ISLAMABAD, 2025-06-17 15:37:00
Solar Panel Tax Proposal Rejected
pakistan’s government faced a setback as committees rejected a proposed tax on solar panel imports, potentially impacting the cost of renewable energy.
- Committees rejected an 18% sales tax on imported solar panels.
- The FBR estimates the tax would have brought in Rs20 billion.
- Concerns were raised about the impact on solar panel prices.
The government’s plan to levy an 18% sales tax on imported solar panels met a swift defeat on Tuesday,as the National Assembly and Senate Standing Committees on Finance and Revenue voted against the proposal. this decision could influence the cost and accessibility of solar energy in the coming fiscal year.
Federal Board of Revenue (FBR) Chairman Rashid Mahmood Langrial stated that there was no existing sales tax on complete solar panel imports. He noted that taxes are applied if parts are imported and assembled locally. “Solar panels used to be very expensive, but now they have become quite cheap,” he added.
Syed Naveed Qamar, the committee chairman, made it clear, “All political parties opposed the tax on solar [panels] in the House. There are other ways of collecting money and our position regarding tax on solar panels is clear.”
Mohammad Mobeen,a committee member,highlighted the price increase following the initial tax announcement. He urged, “check the market to see how much solar prices have increased within two weeks,” calling the sales tax “unbearable for the poor.”
The FBR chairman estimated the 18% tax would have generated Rs20 billion. Shahram Tarakai, a committee member, countered, “If technology is to be brought into the contry, the government should provide relief to the people.” He also pointed out the already high cost of doing business in Pakistan.
Shahida Akhtar Ali, a Member of the national Assembly (MNA), proposed, “A tax should be imposed on sugary drinks, while tax relief should be given on solar panels.”
The FBR chairman further detailed that 32,000 MW of solar power was imported over the past five years, with 6,271 MW used in net metering.He mentioned that 13,000 MW of solar panels remained uninstalled, with 6,506 MW used in non-net metering and 5,521 MW used off-grid. He also noted that over-invoicing in solar panel imports had been an issue, which the Senate Standing Committee on Finance had also discussed.
A press release from the Senate standing committee stated they had a fifth session today. It said that the committee reviewed several recommendations and policy concerns.
“The committee strongly recommended withdrawing the proposed 18pc GST on solar panels. Members observed that ahead of the budget,certain stakeholders had imported and dumped solar equipment in anticipation of the tax hike. The chairman emphasised the discriminatory nature of the move, saying, ‘The committee rejects the sudden imposition of GST on solar imports and urges immediate withdrawal.'”
Finance bill 2025
The NA panel also reviewed the Finance Bill 2025, which included provisions allowing tax commissioners to make arrests and issue money laundering notices.
The FBR chairman explained that the law seemed to suggest it was introduced to arrest traders. “The law on [such] arrest already exists which has seen some changes.
“There is an amendment related to tampering or forgery while the second clause is about tampering and fraud on a large scale.”