SRO 2026/189: Tax Exemptions for Green Energy Projects

The Federal Board of Revenue has notified SRO 2026/189, providing substantial tax exemptions and incentives for green energy projects across Pakistan.

Scope of Exemptions

The SRO covers various categories of renewable energy projects:

Solar Energy

• Complete exemption from customs duty on solar panels
• Zero-rated sales tax on inverters and batteries
• Income tax holiday for 10 years for solar power plants

Wind Energy

• Duty-free import of wind turbines and components
• Exemption from sales tax on installation services
• Accelerated depreciation allowance

Eligibility Requirements

To qualify for these exemptions, projects must:

1. Be registered with the Alternative Energy Development Board
2. Have minimum capacity of 1 MW for commercial exemptions
3. Comply with environmental standards
4. Submit quarterly progress reports to relevant authorities

Residential Benefits

Homeowners installing solar systems up to 10 kW can also benefit from customs duty exemptions on imported equipment and reduced sales tax rates.

This initiative aligns with Pakistan's commitment to achieve 60% renewable energy by 2030.