New and ongoing green energy initiatives are set to face spiraling costs in the wake of the shock imposition of value-added tax on the import of solar panels from this fiscal year.
The National Board of Revenue has slapped a 5 percent advance income tax (AIT), 5 percent advance trade VAT and 15 percent VAT on the import of the module. In other words, there would be about 27 percent levy.
The measure by the revenue authority took the industry stakeholders, particularly the solar panel importers and solar system integrators, by surprise as they have been demanding zero duty import benefit to facilitate fast expansion of the green energy.
“Solar home systems will become unaffordable for many because of the latest NBR measure,” said Dipal Barua, president of the Bangladesh Solar and Renewable Energy Association (BSREA), a body for solar panel importers, integrators and producers.
The tax administrator slapped the advance trade VAT and VAT at a time when the government aims to generate 2,000MW of electricity, or 10 percent of total production, through renewable energy by 2020.
A number of solar-based initiatives such as solar irrigation, mini-grids, rooftop-based solar home system and solar power plants are being established in various parts of the country.
Already, 999 solar irrigation schemes, 15 mini-grid and 25MW solar rooftops have been established, according to Sustainable and Renewable Energy Development Authority (SREDA).
