Will there be a VAT reduction for solar panels?


A new, important agreement was reached between the European economic and finance ministers at Tuesday's meeting in Brussels. The topic was the amendment of the EU VAT directive, i.e. who and how will be able to use the reduced VAT rates. Will this VAT rate be applicable to solar panels or solar panel systems? It was this question that made us feverish the most.

With the recent amendment of the EU VAT directive, the Council has unified and clarified many rules. However, the main rule is still that, compared to the normal VAT rate, the given country can only apply two additional discounted VAT rates, the lowest of which can only be 5%. What is new, however, is that reduced VAT rates can only be applied to a maximum of 24 types of products and services listed in Annex 3 of the decree.

The key under 5% can also be used, as well as the VAT exemption, but only for a maximum of 7 categories of basic needs, passenger transport, or cultural products and/or services that are specifically listed in Annex 3 of the decree.

However, one of the new points of the decree states the following: The procurement and installation of solar panels can also be included in these 7 product categories, for which the EU allows a VAT rate below 5% or VAT exemption, as this is in line with climate protection goals.

The European Parliament will still add an opinion to the council deal (the regulation itself), and if this happens, the member states will formally accept the plan, and the VAT directive amendment can become official, and each member state will be able to decide for themselves whether to apply it in practice. will you get the reduced VAT rate?

Domestic decision-makers now have an important opportunity, the application of a new, more favorable VAT rate would greatly contribute to compensating the currently experienced increase in the price of raw materials and transport, thanks to which the installations could continue in the next year even at the price level of 2021 - be it independent, partially or fully subsidized investments.

We are very confident that by the time our currently significant solar panels from our previous purchases are exhausted, the domestic VAT relief for solar products and services can be legislated.


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