Big Shock in Budget: Solar Panels and Electric Vehicles Expected to Become More Expensive

Islamabad (Digital Itla): Due to proposals for tax hikes across various sectors in the upcoming budget for the fiscal year 2026-27, fears are being expressed that the prices of solar panels, electric vehicles, and hybrid cars could increase significantly. According to sources, multiple tax measures are under consideration during budget preparation, aimed at boosting revenue. Under this proposed plan, a recommendation has emerged to increase the General Sales Tax (GST) on electric vehicles from 1% to 18%. Similarly, it has been recommended to increase the tax on hybrid vehicles from 8% to 18%, which is expected to cause a clear hike in the prices of these vehicles. According to reports, a proposal to increase the GST on solar panels from 10% to 18% is also under consideration, which could increase the cost of solar energy systems and make adopting solar energy more expensive for ordinary consumers. According to experts, if these proposals are approved, a significant price hike could be witnessed for electric cars, motorcycles, rickshaws, trucks, buses, and other electric vehicles. Similarly, electric pickups, tractors, and double-cabin vehicles are also likely to become pricier. On the other hand, industrial circles have demanded a reduction in electricity, gas, and taxes, appealing to the government to immediately release 327 billion rupees in refunds. According to the textile sector, if these demands are met, exporters could get relief of up to nearly 100 billion rupees. Experts note that increasing taxes on the energy and transport sectors will not only affect consumers but could also slow down the pace of promoting alternative energy and eco-friendly technology.