Consumers may soon face higher costs for solar energy systems as the government considers increasing General Sales Tax (GST) from 10% to 18% on solar panels and related equipment in the upcoming Budget 2026, according to local media reports.
If approved, the proposed tax change is expected to increase the price of solar installations for households, businesses, and agricultural users at a time when demand for renewable energy solutions has been steadily rising due to high electricity costs and frequent power shortages.
Industry stakeholders and renewable energy experts have warned that the move could slow down the country’s transition toward clean energy, arguing that solar adoption has been driven largely by tax incentives and falling equipment prices in recent years.
They fear that introducing GST at such a rate may discourage middle-income households and small businesses from investing in solar systems.
Traders and importers in the solar market have also expressed concern, stating that prices of panels, inverters, and batteries could see a sharp upward adjustment if the proposal is implemented.
