Please confirm the rate of GST on supplies to be made for Solar Power Generating System against the circular No. 80/54/2018-GST dated 31/12/2018

Reply—As per Notification No.24/2018-Central Tax (Rate); dated 31.12.2018, GST on Solar power generating plant and other renewable energy plants is as follows—

GST rate of 5% rate has been prescribed on renewable energy devices & parts for their manufacture (bio gas plant/solar power based devices, Solar power generating system (SGPS) etc) [falling under chapter 84, 85 or 94 of the Tariff]. Other goods or services used in these plants attract applicable GST. Certain disputes have arisen regarding GST rates where specified goods attracting 5% GST are supplied along with services of construction etc and other goods for solar power plant.

To resolve the dispute, the 70% of the gross value shall be deemed as the value of supply of said goods attracting 5% rate and the remaining portion (30%) of the aggregate value of such EPC contract shall be deemed as the value of supply of taxable service attracting standard GST rate.