- Austrian government plans to abolish VAT on solar PV systems for private individuals for 2 years
- It will remain in effect for a period of 2 years and will be applicable to systems of up to 35 kW capacity
- The move is aimed at reducing bureaucracy and increasing the adoption of solar energy in the country
From January 1, 2024, private individuals in Austria won’t have to pay value added tax (VAT) on purchasing solar PV systems for 2 years. The country’s Federal Minister for Climate Protection, Environment, Energy, Mobility, Innovation and Technology Leonore Gewessler said this will do away with complicated application processes for PV systems.
Local solar PV association Photovoltaic Austria (PV Austria) says this is aimed at significantly increasing PV expansion by eliminating bureaucratic hurdles.
When in force, the sales tax or VAT will come down to 0% for a system size of up to 35 kW. It will apply to both the PV components as well as the assembly, according to the association. It claims with this decision, the government is meeting a long-term demand made by the organization.
The exemption will remain in force for 2 years, stated the association, adding that this is intended to replace federal funding. Currently, Austria is funding rooftop solar and storage systems to increase their adoption with a €600 million budget to be shelled out in 4 grants spread across 2023. The 3rd round was recently successfully completed and the 4th launched (see Austria Opens 4th Funding Round For Solar PV).
Welcoming the decision, PV Austria’s Chairman Herbert Paierl said, “That is it right step, at the right time: because the industry has already felt a decline in demand. This reduction in bureaucracy is counteracting this.”
The association now demands the need for the government to ensure regulatory framework and requisite grid infrastructure to make solar energy work smoothly.
“The relief for private individuals is pleasing. But it must not distract from the fact that we urgently need a modern E-Commerce Act (ElWG) and efficient power grids! Only with grid expansion and a modern legal framework can the future PV systems, which are now supported by the quasi-tax exemption, actually make a contribution to the energy transition,” added Paierl.
Earlier this year, in April 2023, another European Union (EU) nation Ireland was planning to abolish VAT on new solar panels and their installation for households, while Romania and Montenegro, a candidate country to the EU, lowered the VAT values (see Now No VAT On Solar In Ireland).
In December 2021, the European Council proposed to bring down VAT rates for products and services considered beneficial for the environment, including solar (see Solar PV Panels May Get Cheaper In EU).
Source from TAIYANGNEWS
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