The government is likely to eliminate duties on the import of plant, machinery, equipment, and raw materials used in the manufacturing of solar PV panels in the 2024-25 budget, according to well-informed sources cited by Presstonight.
The Managing Director of the Private Power Infrastructure Board (PPIB) highlighted that the Fifth Schedule of the Customs Act, 1969 currently exempts customs duty on solar PV systems, which includes PV modules, charge controllers, inverters, and batteries. However, industrial entities importing machinery, equipment, and spares for local solar PV panel manufacturing face various customs duty rates, along with supplementary sales tax and advance income tax.
This discrepancy significantly increases operational costs for local manufacturers, creating an uneven competitive landscape between imported and locally manufactured equipment. To address this issue and establish a fair competitive environment, PPIB strongly recommended exempting all plant, machinery, equipment, and raw materials used in the manufacturing and assembly of solar PV panels from duties and taxes.
The PPIB argued that this strategic measure would incentivize and bolster domestic production, reduce foreign exchange outflows, and lower operational costs. As the local industry advances beyond its early stages, a gradual withdrawal of duty and tax exemptions on imported finished solar PV products could be advantageous. This phased approach aligns with the goals of the 2019 alternative and renewable energy policy, supporting a balanced transition and the growth and sustainability of local industries.
PPIB has requested the Federal Board of Revenue (FBR) to address this issue by providing exemptions from duties on the import of plant, machinery, equipment, and raw materials used in solar PV panel manufacturing in the upcoming budget proposals.
