Bangladesh cuts solar equipment import taxes to 1%

Bangladesh cuts solar equipment import taxes to 1%

Bangladesh has cut the tax burden on solar equipment imports from 17% to 1% for 180 days to support renewable energy deployment. The measure is expected to reduce project costs and accelerate the country’s push to install 4 GW of rooftop solar before next summer.

By

Syful Islam

18 Sep 2026

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The Bangladeshi government has reduced the overall tax burden on solar equipment imports from 17% to 1% as part of efforts to accelerate solar power deployment.

The reduction is the country’s largest duty and tax cut for solar equipment to date. The new rate will remain in effect for 180 days, according to a notification issued by the National Board of Revenue (NBR).

In June, the NBR exempted solar industry equipment from import duties, regulatory duties and advance tax, as announced in the finance minister’s budget speech for fiscal 2026-27.

However, imported solar equipment remained subject to 15% value-added tax and 2% advance income tax, resulting in a combined tax burden of 17%.

Industry representatives had urged the government to remove the remaining taxes to help attract investment to the sector.

The gazette notification, signed by NBR Acting Chairman Ahsan Habib, states that solar industry equipment will be exempt from customs duties, value-added tax, regulatory duties, supplementary duties, advance tax and advance income tax.

The measure covers steel and aluminum mounting structures, photovoltaic DC and AC generators, solar inverters, battery management systems, supervisory control and data acquisition systems, plant monitoring and control equipment, PV modules, and battery thermal management systems.

Imran Chowdhury, a director of the Bangladesh Sustainable and Renewable Energy Association (BSREA), described the tax reduction as a positive and timely step in support of the government’s rooftop solar expansion plans.

“Reducing the import-stage tax burden on key solar equipment to 1% can help bring down project costs and make rooftop solar more commercially attractive for industries, businesses and residential consumers,” he said.

Chowdhury said such fiscal support would be important for accelerating rooftop solar deployment across Bangladesh.

“For the successful implementation of this initiative, it will also be important to ensure quick customs clearance and streamlined import formalities so that the benefits of the new SRO can be realized on the ground,” he added.

Bangladesh has increased its focus on solar generation as shortages of gas and fuel oil, stemming from supply disruptions related to the ongoing conflict in the Middle East, have exacerbated the country’s power supply problems.

The government is targeting at least 4 GW of rooftop solar capacity before next summer to help manage anticipated power shortages.

In September, the country introduced a BDT 10.50 ($0.086)/kWh tariff for surplus electricity from eligible rooftop solar systems under its net-metering regime. The incentive will apply to systems installed by Feb. 28, 2027, for a three-year period.