ISLAMABAD: Pakistan’s Senate Standing Committee on Finance and Revenue this week urged the government to withdraw a proposed 18 percent general sales tax (GST) on imported solar panels, saying some stakeholders were stockpiling equipment ahead of the federal budget to avoid the new levy.
Under the proposed federal budget for fiscal year 2025–26, the government has included the 18 percent GST on the import and local supply of solar panels and related equipment. The plan has raised concerns among industry players and clean energy advocates who warn that higher costs could slow the rapid uptake of household and commercial rooftop solar systems and undermine national targets for increasing renewable energy’s share in Pakistan’s power mix.
So far this year, solar has provided 25 percent of Pakistan’s grid electricity, placing the country among fewer than 20 worldwide that generate at least a quarter of their monthly power from solar farms.
Pakistan imported 17 gigawatts (GW) of solar panels in 2024 — double the previous year’s volume — to meet surging consumer demand, according to the Global Electricity Review 2025.
“The committee strongly recommended withdrawing the proposed 18 percent GST on solar panels,” the Senate secretariat said in a statement released on Tuesday after the standing committee’s fifth session to review the budget for fiscal year 2025–26.
