Supporting the impact of higher import duties on solar modules and cells, the government has begun stimulating the domestic solar industry.
But there seems to be no intention the government will provide tax incentives to importers of solar modules for support, the government is open to review workable plans submitted by the industry for support.
The government believes that incentives can be provided to the industry wherever needed, but taxes can counteract this. Add to litigation and ask for tax breaks.
The business is looking for relief for projects that were put up for auction before notification of payment of customs duty. However, the government believes that these exceptions may create the practical problems mentioned by the official.
The government sees the creation unconditional tax treatment also stated that they are not in the mood to provide tax breaks.
In March 2021, the government announced a Base Customs Duty (BCD) of 40% on solar modules and 25% on solar cells from April 1, 2022 in an attempt to reduce imports, most of which also come from China. as to promote the domestic production of solar modules to meet local demand. The Social Security Surcharge (SWS) increases the customs duty on solar modules to 44%.
Among various steps to reduce dependence on imports, the Center has notified a Production Incentive Scheme (PLI) for solar modules. In the FY23 Union Budget, Finance Minister Nirmala Sitharaman allocated 19,500 kr in PLI incentives for local production of solar modules, totaling 24,000 kr. Under the scheme, the government would announce an incentive of 4,500 kr.
According to industry participants, the increased import duty could derail the installation of solar projects before the levy, which boosts the pace of development of solar projects, since solar modules account for 60% of the total project cost.
Representations will be given to the Ministry by people familiar with the events and new renewable energy a request to the project management is given before March 9, at the time of the announcement. But the government does not intend to grant any exemptions.
Questions sent to the Department of Revenue and the Ministry of New and Renewable Energy remain unanswered.
Some solar energy developers are trying to thwart tariffs. Some developers have referred to entire solar plants as “bonded warehouses” to prevent filing taxes.
The concessions were canceled on 11 July by the Central Administration of Indirect Taxes and Customs; they would be made available under a bonded warehouse scheme that allows solar energy developers to defer paying high import duties. The case will go to court.
India aims to reach 500 GW of installed renewable energy capacity by 2030, of which 280 GW is expected to come from solar power.
June 30 bandwidth total solar power is 57.706 GW according to the Ministry of Energy. India installed 3.9 GW of solar power in the June quarter, up 15% from 3.3 GW installed in the previous quarter.