Solar equipment import tax cut to 1% to boost renewables.
The government has further reduced import duties and taxes on solar power equipment and components to accelerate the expansion of renewable solar power generation amid the global energy crisis and power shortages.
Under the new facility, importers will pay only 1 percent total tax on eligible solar power-related equipment and components. The National Board of Revenue (NBR) announced the decision in a press release today.
The facility exempts such imports from customs duty above 1 percent, regulatory duty, supplementary duty, value-added tax (VAT), advance tax and advance income tax.
The facility will remain effective for 180 days from the date of issuance of the relevant statutory regulatory order (SRO), said the NBR.
The revenue board earlier provided duty and tax exemptions for key inputs used in the solar power sector through SRO No. 159-Law/2026/14/Customs, dated June 8, 2026, under the budget for fiscal year 2026-27.
Under that facility, importers received exemptions from import duty, regulatory duty and advance tax, leaving a 17 percent tax burden, comprising 15 percent VAT and 2 percent advance income tax.
The NBR has now expanded the facility to further reduce the cost of solar power equipment and components.
For the first time, commercial importers will also receive the facility, subject to specified conditions. Previously, the duty and tax benefit did not apply to imports of solar power-related equipment and components by commercial importers.
The NBR said the reduced tax burden would help lower the cost of solar power projects and accelerate the addition of new power generation capacity.
It also expects the measure to reduce dependence on fossil fuels and strengthen the country's energy security and sustainable economic development.
