GST Sparks Cost Escalation Fears For Renewable Energy Sector

The additional financial burden on equipment and accessories after the implementation of the Goods and Services Tax is threatening to disrupt the renewable energy sector. The tax on machinery, cables and transformers now stands at 18 percent compared from zero in the pre-GST regime. For solar modules, the levy is 5 percent against zero earlier. That’s a substantial jump as photovoltaic panels account for more than half of a project’s total costs, according to Bloomberg New Energy Finance.