Anil Jain Chairman and Managing Director of the company Refex Energy said Setting up solar plants more expensive in Tamil Nadu. Even as the Tamil Nadu government is trying hard to be seen as India's next solar destination, taxation rules are serving as a hurdle.
"The overall project costs go up, because about 95% of the cost of a solar plant is the equipment while construction cost is very low. And it is the equipment that is taxed. We have petitioned the government but to no avail," Anil Jain, managing director of Refex Energy , said.
Setting up a solar power plant in TN is about 8% more expensive than in other states since companies have to pay between 5% and 14.5% more as taxes while procuring solar equipment, and liaisoning costs are higher.
A company that wants to set up a 10MW solar plant in Tamil Nadu would have to shell out about `3 crore more as the state imposes value added tax (VAT) of 5% on equipment required for solar plants."Andhra Pradesh, Maharashtra and Punjab offer full VAT refund. Tamil Nadu's solar policy offers no such exemption," Dakshinamoorthy Arumugam, director of Marigold Steel and Power, said.
"The overall project costs go up, because about 95% of the cost of a solar plant is the equipment while construction cost is very low. And it is the equipment that is taxed. We have petitioned the government but to no avail," Anil Jain, managing director of Refex Energy , said.
Setting up a solar power plant in TN is about 8% more expensive than in other states since companies have to pay between 5% and 14.5% more as taxes while procuring solar equipment, and liaisoning costs are higher.
A company that wants to set up a 10MW solar plant in Tamil Nadu would have to shell out about `3 crore more as the state imposes value added tax (VAT) of 5% on equipment required for solar plants."Andhra Pradesh, Maharashtra and Punjab offer full VAT refund. Tamil Nadu's solar policy offers no such exemption," Dakshinamoorthy Arumugam, director of Marigold Steel and Power, said.
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