The new tax, applied under the General Sales Tax (GST) framework, aims to broaden the government’s revenue base amid rising fiscal pressures. Previously, solar panels had enjoyed reduced or zero taxation to promote cleaner energy adoption and support the country’s green energy targets.
However, this decision has been met with concern by industry experts and environmental advocates. They warn that the added cost may discourage both residential and commercial users from investing in solar power systems, slowing Pakistan’s progress toward energy diversification and sustainability.
Solar energy companies have already reported a rise in customer cancellations and project delays due to the increased upfront costs. Environmental groups have urged the government to reconsider the policy, stressing the importance of accessible renewable energy solutions in combating climate change and energy insecurity.
While the Ministry of Finance has defended the tax as a necessary fiscal measure, stakeholders hope for dialogue and possible revisions to align economic needs with environmental commitments.
