10%
sales tax on imported solar panels and PV modules
Enacted · Finance Act 2026
Solar — Budget 2025–26 vs 2026–27
Verified federal sales-tax treatment for solar panels and photovoltaic modules in Pakistan.
Enacted 26 June 2026 · Effective 1 July 2026
Enacted 26 June 2026Effective 1 July 2026
- Reviewed against Finance Act 2026
At a glance
Solar sales-tax overview
10%
sales tax on local supply of solar panels and PV modules
0 pp
panel-rate change in FY 2026–27
None
new solar-panel incentive in Finance Act 2026
What changed for solar?
| Measure | FY 2025–26 | FY 2026–27 | Impact |
|---|---|---|---|
| 1. Imported solar panels and PV modules | 10% sales tax | 10% sales tax | No change |
| 2. Local supply of solar panels and PV modules | 10% sales tax | 10% sales tax | No change |
| 3. Solar-panel exemption status | Finance Act 2025 withdrew the exemption | Exemption not restored by Finance Act 2026 | Still taxable |
| 4. Standard 18% sales-tax rate | Reduced 10% panel rate applied instead | Reduced 10% panel rate continues | No change |
| 5. Solar-specific Finance Act measure | 10% rate introduced by Finance Act 2025 | No solar-panel rate amendment in Finance Act 2026 | No new measure |
| 6. Inverters, batteries and other components | Separate tariff treatment by item | Separate tariff treatment by item | Check PCT code |
1. Imported solar panels and PV modules
No change- FY 2025–26
- 10% sales tax
- FY 2026–27
- 10% sales tax
2. Local supply of solar panels and PV modules
No change- FY 2025–26
- 10% sales tax
- FY 2026–27
- 10% sales tax
3. Solar-panel exemption status
Still taxable- FY 2025–26
- Finance Act 2025 withdrew the exemption
- FY 2026–27
- Exemption not restored by Finance Act 2026
4. Standard 18% sales-tax rate
No change- FY 2025–26
- Reduced 10% panel rate applied instead
- FY 2026–27
- Reduced 10% panel rate continues
5. Solar-specific Finance Act measure
No new measure- FY 2025–26
- 10% rate introduced by Finance Act 2025
- FY 2026–27
- No solar-panel rate amendment in Finance Act 2026
6. Inverters, batteries and other components
Check PCT code- FY 2025–26
- Separate tariff treatment by item
- FY 2026–27
- Separate tariff treatment by item
The 10% figure applies to solar panels and PV modules covered by the reduced-rate entry. Inverters, batteries, structures and other system components can have separate tariff and tax treatment.
Example: PKR 1,000,000 tax-exclusive panel supply
FY 2025–26 sales tax
PKR 100,000
FY 2026–27 sales tax
PKR 100,000
Budget-year difference
PKR 0
Illustration covers the 10% panel/PV-module rate only and assumes PKR 1,000,000 is the tax-exclusive value.
Explore budget impact by sector
Compare the enacted FY 2026–27 changes across taxpayers and industries.
Freelancers & IT
- 0.25% PSEB rate extended to Tax Year 2029
- Export collection: 1.25%
- Foreign-card WHT: 0.5%
Business & super tax
- 0% for most persons up to PKR 500M
- 8% above PKR 500M
- Banks, E&P and fertiliser remain at 10%
Property
- Section 7E repealed
- Sale WHT: 2.75%
- Purchase WHT: 1.25%
Vehicles
- Imported EV FED: 0% / 30% / 40% by USD value
- Imported 2000cc+ vehicles: new special duty
- ICT ≤1000cc: PKR 20,000 lifetime
Solar
- 10% sales tax continues
- No new Finance Act 2026 increase
Defence
- PKR 3.00T defence services
- PKR 822B military pensions, separate
- PKR 925.8B physical assets
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Frequently asked questions
Is there a new tax on solar panels in Budget 2026–27?
No. Solar panels and PV modules stay at the reduced 10% sales-tax rate for both imports and local supply. Finance Act 2026 contains no solar-panel rate amendment.
Did sales tax on solar panels rise to 18%?
No. The standard 18% sales-tax rate does not apply to solar panels and PV modules covered by the reduced-rate entry. The 10% panel rate continues in FY 2026–27.
Are solar panels exempt from sales tax?
No. Finance Act 2025 withdrew the exemption and placed solar panels and PV modules at a reduced 10% rate. Finance Act 2026 did not restore the exemption.
How much sales tax applies to a PKR 1,000,000 panel supply?
Sales tax is PKR 100,000 in FY 2025–26 and PKR 100,000 in FY 2026–27, a difference of PKR 0. The illustration covers the 10% panel and PV-module rate only and assumes PKR 1,000,000 is the tax-exclusive value.
Do inverters and batteries also get the 10% rate?
Not automatically. Inverters, batteries, mounting structures and other system components keep separate tariff treatment by item, so check the applicable PCT code rather than assuming the panel rate.
Did Finance Act 2026 add any new solar incentive?
No. The Act leaves the federal solar-panel rate unchanged. It neither raises that rate to 18% nor creates a new solar-panel incentive.
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