The government increased the Import Tax on solar panels for the third time. Also called photovoltaic cells or photovoltaic modules, this equipment was exempt from tax under the government of Jair Bolsonaro (PL). During the administration of Luiz Inácio Lula da Silva (PT), the tax was raised to 6%, then to 9.6% and now to 25%. This latest adjustment was published in the Official Gazette of the Union on Tuesday (12). The sector evaluates the measure as a “major setback” in the energy transition, as the majority of panels are imported, which makes the fee weigh significantly on the cost of product. And he considers that this would be the time to adopt measures that encourage the expansion of clean energy, and not the other way around.
Brazil has few companies that manufacture solar panels and they only supply around 5% of national demand, according to Ronaldo Koluszuk, president of the board of directors of the Brazilian Photovoltaic Solar Energy Association (Absolar). The national production capacity is 1 gigawatt (GW) per year and Brazilian imports in 2023 were more than 17 GW.
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“We are very disappointed. The government’s entire discourse has always been about generating green jobs and the vocation for this industry. However, the way the government has acted goes against this narrative”, says Koluszuk. “We see that it is more narrative than, in fact, wanting to make Brazil a strong axis of sustainability.”
According to the Absolar advisor, the increase will not affect the end consumer that much. The impact will be indirect. On the other hand, he considers, the readjustment could be aggressive for small and medium-sized companies, sour investments and even “bury” plans to develop green hydrogen in the country, for which solar energy is a great ally.
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“The tax (on the import of solar panels) was zeroed in the previous government. In this one, it went to 6% and then to 9.6%. Now, it goes to 25%. The point is: who does this matter?”, he asks .
“The increase will deter investors from bringing plants [industriais] here. Solar plants involve long-term maturation. When the government makes a change like this, it ends up burying green hydrogen. The decision will generate unemployment, not jobs as the government says”, says the executive.
Increase could cause layoffs in the sector, says Absolar
According to Absolar, for every 30 jobs created in the solar photovoltaic sector, only two are in equipment manufacturing. The entity says that “contrary to what the federal government claims, the measure does not promote the densification of the national industry”.
National companies assemble modules, using completely imported inputs, states the association. “Thus, this increase in tax leads to a reduction in jobs exactly in the most thriving chain, which brings together the equipment distribution and sales sector and the installation and maintenance services of photovoltaic systems”, says a statement.
In addition to the increase in the base rate on the import of solar panels, at the beginning of the year the (so-called ex-tariff) of 27 models of solar inverters. This equipment is used to convert solar energy generated by solar panels from direct current to alternating current, so that it can flow throughout the electrical power grid.
In other words, when the base tariff is high but there is an ex-tariff in force for a specific product that is part of the solar chain, there is a balance in taxation. But, by raising the import tax and, at the same time, reducing the ex-tariff, the government makes the cost even more onerous for companies and consumers.
