On September 4, 2025, according to media reports, the Indian government has reduced the Goods and Services Tax (GST) on solar photovoltaic modules and wind turbines from 12% to 5%.
Key Outcomes:
- India has slashed the GST on solar modules from 12% to 5%, a move expected to significantly reduce project costs.
- The tax reduction will benefit renewable energy developers and ease purchasing expenses for consumers.
- Industry leaders have welcomed the reform, believing it will boost domestic manufacturing, storage adoption, and India’s vision of self-reliance.
The Indian Ministry of Finance has lowered the GST on solar modules to 5% as part of a broader revision of GST rates. Approved during the 56th meeting of the GST Council, this decision is anticipated to lower project costs while ensuring ease of doing business.
Renewable energy equipment and manufacturing components benefiting from the 5% GST rate include solar photovoltaic cells (whether assembled into modules or panels), solar power systems, solar lanterns, wind turbines, and wave/tidal energy devices/plants, among others.
