PV components other than modules to be taxed at 18% or more in India - report

Facebook
Twitter
LinkedIn
Reddit
Email
Imported inverters could even be subject to an extra International GST tax. Flickr: Honeycuttaddison

The Goods and Services Tax (GST) on solar equipment in India will be 18% or more for some solar components and 5% for modules, according to consultancy firm Mercom Capital Group, citing unnamed Ministry of New and Renewable Energy (MNRE) officials and government agency sources.

PV Tech contacted MNRE on the issue, but a spokesperson said that the minister for energy would be officially announcing the GST details in full in the form of a press briefing in the coming days.

This article requires Premium SubscriptionBasic (FREE) Subscription

Unlock unlimited access for 12 whole months of distinctive global analysis

Photovoltaics International is now included.

  • Regular insight and analysis of the industry’s biggest developments
  • In-depth interviews with the industry’s leading figures
  • Unlimited digital access to the PV Tech Power journal catalogue
  • Unlimited digital access to the Photovoltaics International journal catalogue
  • Access to more than 1,000 technical papers
  • Discounts on Solar Media’s portfolio of events, in-person and virtual

Or continue reading this article for free

In what would be a blow to the solar industry due to the ensuing higher costs of solar project development, Mercom reported that there will be different rates for project components, despite previous expectations that all PV parts would come under the 5% tax enjoyed by modules.

Most importantly, an MNRE official told Mercom that there would be a 5% increase in project costs.

The consultancy provided the following table revealing the various rates, including a potential – but yet to be confirmed – International GST (IGST) for imported inverters:

Component GST tax rate
solar modules 5%
Imported inverters 18% + 5% IGST
Domestic Inverters 18%
Cables 18%
Structures 18%
Balance of System (BOS) 18%
Primary Batteries 28%
Services 18%

In a continuation of the uncertainty surrounding the GST saga, Mercom said: “Government agencies still seem unsure about how the ratio of goods to services will be calculated.”

Uncertainty has already caused a minor delay to a PV tender in Gujarat And seriously concerned the energy storage industry over higher tax rates in general and a lack of clarity on the GST for primary and secondary batteries.

Another R&D-related MNRE official told Mercom that the ministry will soon hold a workshop to educate officers on the effects of the GST and which goods the various “tax slabs” would apply to.

Read Next

August 8, 2025
German solar inverter manufacturer SMA Solar posted losses in the first half of 2025, as demand in the residential and corporate & industrial (C&I) solar sectors 'remains weak'.
August 6, 2025
The Indian Ministry of New and Renewable Energy (MNRE) has published the approved list of models and manufacturers (ALMM) for solar cells, which contains 13GW of annual nameplate capacity across six manufacturers.
August 4, 2025
Indian solar PV module manufacturer Vikram Solar will supply 250MW of n-type modules to Bondada Group for its solar project in Maharashtra.
August 4, 2025
Waaree Energies has commissioned a 1.8GW solar module manufacturing line at its factory in Chikhli, Navsari district, Gujarat.
July 30, 2025
Donald Trump has announced a 25% tariff on all imports entering the US from India from the 1st August 2025.
July 29, 2025
US-based solar manufacturer T1 Energy has expressed support for the US government’s tariff investigations into global polysilicon imports and solar products from Laos, Indonesia and India.

Subscribe to Newsletter

Upcoming Events

Solar Media Events
September 16, 2025
Athens, Greece
Solar Media Events
September 30, 2025
Seattle, USA
Solar Media Events
October 1, 2025
London, UK
Solar Media Events
October 2, 2025
London,UK
Solar Media Events
October 7, 2025
Manila, Philippines