In Short : In an effort to lower project costs and hasten the adoption of clean energy in India, the government has suggested lowering the GST rates on important solar and renewable energy components from 12–18% to 5%.
Encouraging Innovation and Strategic Growth
GST was lowered from 12% to 5% on solar cells, panels, inverters, pumps, heaters, and lamps.
GST was reduced from 18% to 5% on solar wires, batteries, PCUs, and transformers.
IT equipment, or data recorders, still account for 18%.
Businesses, farmers, and households will be able to afford renewable energy systems thanks to this cut, which will drastically lower upfront costs.
Impact and Significance of Clean Energy
The suggested tax breaks will:
Increase funding for solar energy projects.
reduced pricing for renewable energy.
Increase the appeal of adopting clean energy to help India reach its net-zero 2070 goal.
About GST Reform
India’s larger clean energy initiative, which aims to reach 500 GW of renewable capacity by 2030, includes this reform. The government is accelerating the adoption of utility-scale projects, energy storage technologies, and rooftop solar by lowering taxes.
