GST Slashing Proposal to Boost Green Hydrogen Affordability
Key Ideas
  • A Goods and Services Council panel in India has recommended reducing GST on green hydrogen, storage batteries, and electrolysers from 18% to 5% to enhance affordability and usage of clean energy.
  • The proposal, set to be discussed at the GST Council meeting in July, aims to make green hydrogen and energy storage solutions more accessible, aligning with India's clean energy objectives.
  • Industry stakeholders have advocated for these tax cuts, emphasizing that lower tax rates can drive the adoption of green hydrogen technologies, ultimately contributing to a greener energy landscape.
  • The move complements initiatives like the India-EU Clean Energy and Climate Partnership, which focuses on collaborative projects, research, and the inclusion of green hydrogen imports in the energy mix.
A panel within the Goods and Services Council in India has recommended a significant reduction in the Goods and Services Tax (GST) on green hydrogen, storage batteries, and electrolysers. The proposal aims to bring down the current tax rate of 18% to 5% to encourage the affordability and uptake of clean energy solutions. This recommendation is part of an effort to support India's clean energy goals and promote sustainable practices in the energy sector. The fitment committee, responsible for assessing tax rates, has also supported lowering the GST on storage batteries and electrolysers used in green hydrogen production to 5%. The industry has been actively advocating for these tax reductions, highlighting the potential for increased adoption of green hydrogen technologies if the tax burden is lessened. The proposed tax cuts are expected to be discussed and potentially approved at the upcoming GST Council meeting scheduled for July. This initiative aligns with broader efforts to promote clean energy sources and reduce carbon emissions. In conjunction with national objectives, partnerships like the India-EU Clean Energy and Climate Partnership are fostering cooperation on projects, research, and the integration of green hydrogen imports into the energy landscape, emphasizing the importance of sustainable energy practices for a greener future.
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