New GST rate on solar system

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The GST rate on solar systems has increased from 5% to 12%, effective from October 1, 2021, as recommended by the 45th GST Council meeting. This change applies to specified renewable energy devices and their parts. The supply of solar power generating systems (SITC) is typically classified with a 70:30 proportion for GST calculation, meaning 12% on 70% of the contract value and 18% on the remaining 30%.

kaushal mistry

kaushal mistry (Querist)

27 September 2021 Dear Sir

There are any change in GST rate on solar system
If yes.
what is new rate ?
Applicable on which date.

CA R SEETHARAMAN

CA R SEETHARAMAN (Expert)

27 September 2021 5% GST applicable.
The supply of Solar Power Generating System along with other goods and service of designing, erection, commissioning & installation of the same is classified under SI no. 234 of Notification No. 1/2017-Central Tax (Rate) dated 28.6.2017 as amended vide Notification no. 24/2018-Central Tax (Rate) dated 31.12.2018 and SI no. 38 inserted in Notification no. 11/2017-Central Tax (Rate) dated 28.6.2017 vide Notification no. 27/2018-Central Tax (Rate) dated 31.12.2018.

kaushal mistry

kaushal mistry (Querist)

27 September 2021 Sir
Thanks for reply
but my agent told me GST rate increase 5 to 12, The rate applicable WEF 1-10-2021.

kaushal mistry

kaushal mistry (Querist)

27 September 2021 Dear Sir

My agent send me 45th Meeting of the GST Council, Lucknow
17th September, 2021 press release in it
Major recommendations on GST rate changes in relation to Goods [w.e.f 1.10.2021 unless
otherwise stated]
Specified Renewable Energy Devices and parts from 5% to 12%.

It's applicable or just recommendation.

Lekhraj sood

Lekhraj sood (Expert)

27 September 2021 Yes it will increase to 12% as per 45th GST council meeting but haven't seen the notification as yet. Also note that the SITC of solar power generation system is charged in 70:30 proportion like 5%(12% if changed) on 70% of the contract value and 18% on the remaining 30%.

kaushal mistry

kaushal mistry (Querist)

27 September 2021 Thanks sir

Approx. time for notification ( as per press meeting it's applicable W.E.F 1-10-2021)

CA Altamush Zafar

CA Altamush Zafar (Expert)

27 September 2021 There is no appox time. Fresh rates will be applicable as when the notification is issued. So you will have to keep yourself updated.

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