NA Committee Rejects Proposal to Slap 18% Tax on Solar Panels in Pakistan
In a significant win for clean energy in Pakistan, the NA committee rejected the proposal to slap an 18% tax on solar panels during the ongoing federal budget discussions for the year 2025–26. This decision sparked a wave of relief across the country, especially among households, solar energy companies, and climate activists who feared the tax would push solar technology out of reach for many Pakistanis.
The proposed 18% GST on solar panels was seen as a major threat to the growing adoption of renewable energy. People from all provinces were worried. Energy costs are already high, and for many families, solar power in Pakistan is the only way to reduce electricity bills. With this rejection, hope is renewed. It signals the government’s seriousness in supporting green energy solutions and protecting citizens from further economic pressure.
Why the Government Proposed 18% Tax on Solar Panels
In the initial 2025–26 federal budget draft, the Ministry of Finance included a proposal to introduce an 18% sales tax on all imported solar panels. Officials claimed it was necessary to increase revenue and regulate the sector. The government also argued that solar technology should be taxed like other electronics.
However, this decision was met with strong public reaction. Experts from the Pakistan Renewable Energy Association warned that this move would slow down progress toward clean energy goals. People feared that such a tax would make solar panel prices in Pakistan jump by 25 to 30 percent, making systems too costly for middle- and lower-income families.
Even lawmakers from both the ruling and opposition parties raised concerns. They pointed out that taxing solar energy was against the national policy of encouraging sustainable energy and reducing our dependency on fossil fuels. The backlash was so strong that the NA standing committee on finance was forced to reconsider the proposal in a special session.
NA Committee Rejects Tax Proposal – What Happened
After multiple heated discussions in parliament, the NA committee officially rejected the 18% GST proposal on solar panels. This decision was based on expert opinions, market realities, and public feedback. According to sources, the committee stressed that taxing solar panels would hurt economic growth, burden ordinary citizens, and delay Pakistan’s shift to renewable energy.
During the committee meeting, members reviewed budget impact reports and heard from local solar importers and installers. A representative from a Lahore-based solar firm said, “Our business would have collapsed overnight. This tax was not just anti-business, it was anti-environment.” Their voices, along with citizen protests, made it clear that the people of Pakistan supported solar energy.
The rejection was later confirmed by a written summary issued by the committee’s secretariat, stating that the proposed tax was “not aligned with public interest or national clean energy goals.” This firm stance from the National Assembly sends a strong message that Pakistan supports solar power adoption and won’t let short-term revenue plans damage long-term sustainability.
Impact on Solar Panel Prices in Pakistan
If the 18% tax on solar panels had been approved, the price of common solar systems would have increased drastically. Currently, the average price of a 5kW system ranges between PKR 700,000 to PKR 850,000, depending on the panel type and brand. With tax, prices would have risen by up to PKR 130,000–150,000. That’s a huge jump for the average household.
Let’s take a look at what prices might have looked like:
| System Size | Current Price (PKR) | Price With 18% Tax (Estimated) |
|---|---|---|
| 3kW | 480,000 | 566,400 |
| 5kW | 750,000 | 885,000 |
| 10kW | 1,350,000 | 1,593,000 |
These figures clearly show how damaging the tax could have been. By rejecting it, the government has kept solar panel installation in Pakistan within reach for many. This also benefits schools, hospitals, and small businesses that are switching to solar to reduce operational costs.
What This Means for Renewable Energy in Pakistan
Pakistan’s energy crisis is getting worse each year. Power outages, rising bills, and heavy dependency on imported oil are major issues. Solar energy is the one bright spot, with more families and businesses installing panels to get stable, clean electricity. The NA committee’s rejection of the solar tax supports this trend and encourages more people to invest in renewable energy systems.
This move also brings Pakistan closer to its climate change goals under international agreements. Countries around the world are moving toward clean energy, and Pakistan is no exception. Supporting solar now means cleaner air, fewer emissions, and energy independence in the future. The decision also shows global investors that Pakistan is serious about becoming a green economy.
Will the Government Try to 18% tax on solar panels Again?
While the 18% tax was rejected now, that doesn’t guarantee it won’t return later. In the past, similar proposals have come back during mid-year budget adjustments or under different titles. The government might look at “value-added services” or impose small duties in the future to collect revenue from the growing solar market.
But for now, the official stance is clear. The NA committee wants to protect solar panel affordability and promote solar adoption in Pakistan. Still, it’s a good idea for people interested in going solar to act quickly before any future policy change. Time is money, especially when sunshine is free.
How You Can Still Benefit from Solar Panels in 2025
If you’re considering solar for your home or business, this is the right time. Prices are stable, government policies are supportive, and banks like NBP, HBL, and Meezan are offering solar financing schemes under low markup rates. Some provincial schemes even provide partial subsidies on installation.
To help you plan better, here’s a quick checklist:
| Action | Why It’s Important |
|---|---|
| Compare quotes from 3 installers | Avoid overpricing |
| Choose Tier-1 panels (Longi, JA) | Better efficiency and warranty |
| Ask about net metering setup | Save more by selling excess energy |
| Look into loan options (e.g. NBP) | Spread out the cost of installation |
| Register your system with NEPRA | Stay compliant and enable grid use |
Installing now means you beat any future taxes and enjoy lower electricity bills within 2–3 months. It’s not just an upgrade — it’s an investment.
Conclusion
The NA committee’s rejection of the 18% solar tax proposal was more than a financial decision — it was a stand for a greener, fairer Pakistan. In a time when families are battling inflation and energy costs, this move brings much-needed relief and shows strong leadership.
Solar panels aren’t just machines. They are tools for survival in modern Pakistan. With this decision, the government has told its people: your future matters more than fast money. Now, it’s time for citizens to take that opportunity and turn rooftops into powerhouses.
