Pakistan is trying to get back its economy on track by bringing more and more people into the tax net. This will enable the country to generate revenue equivalent to its spending. This is a harsh reality that we are spending more than we are generating. This has put the government as well as the country into a difficult position. The GST applied on the products is making living hard for the common man. This is also one of the reasons why people say kitni mehngai ho gaye hai. Recently, the government has enforced tax on sales of solar water heaters imports.
Sales tax on the solar water heaters import has agitated many traders. They are seeing this step as something ‘anti-green’. According to the traders of solar water heaters, the government is trying to minimize the efforts of the manufacturers to make eco-friendly products. The solar traders think of this move as against the evolution of the solar market. The government wouldn’t have landed in hot waters with the solar traders if the imposed taxes were imposed under the banner of development schemes. This would have made this an easy move without having to face a backlash. The 17 % sales tax on the import of solar PV equipment is not welcomed by most of the concerned parties.
The debate here is not only the tax imposed but also the government needs solar utility projects. Although the government had plans for introducing many solar projects but were put on hold because of issues concerning tariffs. Also, current financial issues, circular debt, and temporary additional power capacity have prolonged the installation of solar projects. Yet, the provincial governments are speeding up the process of introducing solar installation projects. We are in need to increase the solar capacity which is likely to expand as soon as we are going to install solar projects.
Local manufacturing of solar water heaters will help produce cheap products with improved quality. It will also promote technological advancements and skills in Pakistan. Moreover, the employment rate is also going to increase.
Pakistan’s government needs to bring reforms to evolve the solar market and promote locally manufactured products. This will encourage our local manufacturers and companies. It will strengthen Pakistani markets.