The National Board of Revenue has lifted value added tax (VAT) on import of solar panels in the face of demand from stakeholders.
The move comes two months after the revenue authority slapped a 5 percent advance income tax (AIT), 5 percent advance trade VAT and 15 percent VAT on the import of solar modules.
Under the latest initiative, the NBR lifted the 15 percent VAT to facilitate fast expansion of the green energy.
“We have exempted the VAT on import to cut cost of solar home systems and encourage its expansion,” said a senior NBR official.
The revenue collector has been offering duty benefit for solar panel import to encourage expansion of solar-based electricity generation.
Until fiscal 2015-16, no tax was applied on solar panels.
The 5 percent AIT was imposed in fiscal 2016-17, said Infrastructure Development Company Ltd, a major financier of renewable energy, in a letter to the NBR at the end of June seeking withdrawal of all taxes on solar module import.
