Austria slashes VAT on residential PV

The Austrian government has decided to reduce the VAT for solar modules to 0% from January 2024. Climate Protection Minister Leonore Gewessler announced the new measure as part of a new economic stimulus package.

“As an association, we have been calling for this measure for a long time and are very pleased that the PV expansion in the small segment will be given a boost next year,” said Herbert Paierl, CEO of trade body PV Austria. “This means that our motto ‘Zero sales tax – zero bureaucracy' will finally be implemented. It is the right step at the right time, as the industry is currently experiencing a decline in demand for photovoltaics.”

Austria is set to reduce VAT to 0% starting in early 2024 for all PV systems with a 35 kW of output, covering both component purchases and installation costs. This two-year measure is designed to support solar expansion by simplifying processes and replacing federal rebates.

Since the start of the Ukraine conflict, Austria has joined other European nations such as Ireland and Germany in adopting this strategy. Austria installed more than 1 GW of solar in 2022, up from 740 MW in 2021, 341 MW in 2020, and 247 MW in 2019, bringing its cumulative PV capacity to 3.79 GW and covering 6.6% of the country's electricity demand last year.