How GST Has Made Rooftop Solar Cheaper in India
Rooftop solar is becoming popular in India, and one big reason is the
reduction in GST
. The government has reduced GST on solar equipment from
12% to 5%
. Because of this, the total cost of installing rooftop solar has come down.
This change helps families, businesses, and even farmers. When this lower GST is combined with schemes like
PM Surya Ghar: Muft Bijli Yojana
, solar power becomes affordable for many more people.
What Changed in GST for Solar?
Earlier, solar projects were charged different GST rates. Some parts were taxed at 12%, others at 18%. Installation work also had a separate tax. This made solar systems more expensive and confusing.
Now, the government has simplified this. Most solar parts are taxed at only 5% GST when they are sold together as a complete solar system.
This includes:
- Solar panels
- Solar inverters
- Wires and cables
- Mounting structures
If any item is sold separately, the GST may be higher. That’s why it is important to check the bill properly.
GST Rates Before and After
| Solar Part | Old GST | New GST |
|---|---|---|
| Solar panels | 12% | 5% |
| Solar inverters | 12% | 5% |
| Cables and wires | 18% | 5% |
| Mounting structures | 18% | 5% |
Subsidy Is Still Available
Lower GST does not
affect solar subsidies.
People can still get government subsidy under
PM Surya Ghar: Muft Bijli Yojana
. This means you save money in two ways:
- Lower GST
- Government subsidy
Both together reduce the total cost of the solar system.
Who Benefits from Lower GST?
- Homeowners
Solar systems now cost less. A 3 kW system can be cheaper by ₹9,000–₹10,500. - Businesses
Lower cost makes rooftop solar a good investment. - Solar installers
Simple GST rules make billing easy and clear. - Farmers
Solar pumps and equipment are now more affordable.
Why Did the Government Reduce GST?
The main goal is to promote clean energy.
Lower GST helps:
- More people install solar
- Reduce electricity bills
- Support India’s clean energy goals
- Encourage Indian solar manufacturing
What Should You Check Before Installing Solar?
Before installing rooftop solar:
- Ask for a clear GST breakup in the bill
- Make sure the system is billed as a complete solar kit
- Check how GST is applied to installation work
- Use a solar calculator to understand savings
Final Words
Because of the GST cut, rooftop solar is now cheaper and easier to install in India. With lower tax and government support, solar power is a smart choice for saving money and using clean energy.