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Govt Imposes 18% Tax on Imported Solar Panels in Budget 2025-26
Imported solar panels to get 18% tax under #Budget2025. Govt aims to boost local industry—but prices for solar systems likely to rise.
ND
by News Desk
2025-06-10
Govt Imposes 18% Tax on Imported Solar Panels in Budget 2025-26

The federal government has announced an 18% tax on the import of solar panels as part of the Rs 17,573 billion federal budget for the fiscal year 2025-26.

Presenting the budget in the National Assembly, Federal Finance Minister Muhammad Aurangzeb said the measure aims to level the playing field for the local solar panel manufacturing industry, which has long struggled to compete with low-cost imports, primarily from China.

“To ensure fairness in competition between imported and locally produced solar panels, we are proposing to levy an 18% sales tax on solar panel imports,” said the finance minister.

🌞 Local Industry vs. Affordability

The decision is being positioned as part of a broader plan to promote domestic manufacturing, reduce dependency on imports, and generate local employment in the renewable energy sector.

However, energy experts and industry stakeholders have expressed concern that the move could make solar energy unaffordable for many households and small businesses at a time when energy prices are already at record highs.

“This policy may benefit a few local manufacturers in the short term but could slow down solar adoption across the country,” said an industry expert. “The average citizen looking to install solar panels will now face a significant increase in costs.”

⚠️ Backlash from Climate Advocates

Climate and energy activists criticized the tax, saying it contradicts Pakistan’s commitments to clean energy and climate resilience.

“While local industry development is important, this sudden 18% tax will likely lead to fewer solar installations, higher electricity bills, and reduced access to clean energy—especially in rural and underdeveloped areas,” said a representative from a climate NGO.

The tax on solar panels comes alongside a new carbon levy of Rs 2.5 per liter on petroleum products, highlighting a dual approach by the government: discouraging fossil fuel use while simultaneously taxing clean energy options.

 
Tagged:

RenewableEnergy

Budget2025

GreenPakistan

SolarTax
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