Regressive Politics: Taxing the Sunlight

In taxing solar panels, the government is not just taxing equipment—it is taxing hope, resilience, and the right to a dignified life. It is, quite literally, trying to put a price on sunlight.

Nasir Aijaz

In a deeply concerning move, the federal government of Pakistan has proposed a tax on solar panels in the newly announced federal budget for the fiscal year 2025–26. The proposal initially included a steep 18 percent tax on solar energy equipment, sparking widespread outrage from the public, environmentalists, and lawmakers alike. Though the standing committees of both the National Assembly and the Senate firmly rejected the proposal, the government, (As stated by Deputy Prime Minister Ishaq Dar) responded by reducing the proposed tax to 10 percent rather than removing it entirely.

This decision, though appearing as a compromise, still delivers a harsh blow to a population already reeling under the weight of persistent energy shortages and skyrocketing electricity prices. The move is being widely criticized as unjust and counterproductive, especially at a time when solar energy had emerged as a hopeful alternative for the masses.

Solar: The Common Man’s Lifeline

Pakistan is grappling with one of the worst energy crises in its history. Across cities and rural areas alike, load shedding spans 12 to 15 hours daily, severely disrupting lives, livelihoods, education, and health services. In response, households and small businesses, unable to rely on the national grid, have increasingly turned to solar energy as a reliable and sustainable solution.

For many middle- and lower-income families, the installation of solar systems has been a one-time investment that ensures uninterrupted power during blistering heatwaves and allows children to study at night. In agriculture, solar tube wells are being used to draw groundwater in remote areas. In short, solar energy has become more than just an option—it is a necessity for survival and progress in the face of governmental failure to ensure consistent electricity supply.

A Regressive Tax on Hope

Imposing a 10 percent tax on solar panels, no matter how reduced from the original proposal, is still tantamount to taxing the sun itself. It disproportionately affects the average citizen, who is already burdened by inflation, joblessness, and utility costs.

It is particularly unjust because it penalizes those who are trying to help themselves and reduce their dependence on the crumbling public infrastructure. Instead of encouraging the shift toward renewable energy—a goal in line with global climate commitments—the government is effectively placing barriers in front of people seeking clean, affordable energy.

This decision also ignores the long-term economic and environmental benefits of renewable energy. Countries around the world are moving toward incentivizing solar adoption. In contrast, Pakistan seems to be going in the opposite direction, burdening the very population it should be empowering.

Politics over Public Welfare

The political justification given by the government—primarily the need to raise revenue—appears short-sighted when weighed against the long-term social and economic consequences. Pakistan’s tax base has historically been narrow, and rather than reforming elite taxation or eliminating corruption and wasteful spending, the state has chosen once again to place the financial burden on ordinary citizens.

Meanwhile, luxury cars, high-end electronics, and elite perks often escape meaningful taxation. This stark contrast exposes the disparity in governance, where convenience and comfort for the powerful are protected while basic necessities for the public are taxed.

The Way Forward

There is still time for the government to reverse this regressive policy. If energy self-sufficiency, environmental sustainability, and public welfare are genuinely national priorities, the tax on solar equipment should be removed entirely. Furthermore, rather than discouraging solar adoption, the government should actively subsidize solar installations, provide zero-interest loans to low-income families, and expand awareness of clean energy solutions.

Pakistan stands at a crossroads. The energy crisis can either deepen social inequality and unrest, or it can be turned into an opportunity for innovation, independence, and equity. But that will only be possible if policies are shaped by the needs of the people—not the pressures of short-term revenue generation.

In taxing solar panels, the government is not just taxing equipment—it is taxing hope, resilience, and the right to a dignified life. It is, quite literally, trying to put a price on sunlight.

Read: Elite Rewards, Commoners Bear the Cost

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The writer is a senior journalist based in Karachi. He can be accessed at nasir.akhund1954@gmail.com