‘Import duty sops for Rs 1.3 lakh crore solar projects will continue’ – Times of India
The move will bring reprieve for 26,000 MW capacity under various stages of implementation by keeping the doors open for equipment imports worth Rs 60,000 crore at 5% duty, instead of the 40% basic customs duty (BCD) that came into effect from April 1. Singh said the ministry has also decided to give a 12-month extension to preMarch 2021 projects to ensure capacity addition did not suffer.
“We placed the (tax) issue before the finance ministry and asked them to include these projects in the concessional duty scheme. We have suggested the concessional duty be retained at the original 5% instead of 7. 5% now and sent a list of the projects,” Singh said. Singh said the 5% concessional duty under the scheme will be allowed to be passed through to avoid putting additional financial burden on promoters.
The finance ministry did not favour the renewableenergy ministry’s initial suggestions for a grant to offset the impact of higher import duty on these projects. Instead, it suggested duty refund.
The revenue department had on October 20 amended the Project Imports Regulations of 1986 to remove solar from the project imports scheme that allowed import of solar modules and cells needed for setting up new units or expansion of an existing unit at a concessional duty of 5%, later raised to 7. 5%.
For promoters whose projects were already underway when the government in March 2021 announced its intent to impose 40% BCD on cells and modules from April 2022, the project import scheme allowed safeguard for their investments.
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