With the new GST, Solar rooftop will be impacted with an increase of overall cost by at least 5% from the existing cost.
What is GST? How does it impact Solar Rooftop sector?
GST means Goods and Service Tax which will be one indirect tax for the whole country. GST is a single tax, right from the manufacturer to the consumer. The final consumer will bear only the GST supplied by the last vendor in this supply chain.
GST is into five different categories. Nil category, 5%, 12%, 18% and 28%.
With this new tax regime, Solar panels which are under tax-free in Bengaluru so far, are included with 5% GST. Solar Inverters will be 5% and other miscellaneous products used specifically for Solar rooftop come under 5%. Whereas copper cables and Batteries come under 28%. Due to these changes, overall system cost would increase by 5% if it is a grid connected system and Off Grid or Hybrid System the cost may vary by another 5%.
With the water pumps under 12% GST, Solar Water pumps cost also will increase by around 8-10% from the present cost.
Image Source: Google Images