Some clarity has been introduced into taxing solar projects. Now, most of the solar projects shall be charged with 5% GST rates, for the supply part. The balance part – which is services component is normally charged at 18%. Most EPC projects were thought of as works contract, since these comprised of both supply and services portion. The clarity that has been introduced is that 70% of the value shall be construed as supply part ( hence, attracts 5% provision) and the balance 30% is construed as services component ( hence, attracts 18% provision).

In summary, this brings down the overall taxation on the project. Will this bode well for the hundreds and thousands of consumers who wish to go in for solar…we say most definitely use- make hay while the sun shines..