Following Croatia, Montenegro to abolish value added tax on solar panels

Montenegro could follow Croatia’s example and abolish the value-added tax (VAT) on solar panels, as the region’s governments increasingly realize the importance of solar power plants on the roofs of households and companies as a measure to deal with the energy crisis.

The Ministry of Economic Development and Tourism of Montenegro announced that it is preparing a new set of measures to smooth down the pressure of the energy crisis in the coming months. One of the measures that will be proposed to Aleksandar Damjanović, the Finance Minister, will be to abolish the VAT on solar panels.

According to Goran Djurović, Minister of Economic Development and Tourism, the abolition of VAT on solar energy is aimed at a faster transition to renewable energy sources. It will also improve the security of the supply in the long run and help the citizens and businesses in case of market disruptions and low water levels in the reservoirs of hydropower plants.

The Croatian government was the first in the region to abolish VAT on solar panels

Of note, the Croatian government was the first in the region to abolish VAT on solar panels to speed up the energy transition and ensure electricity supply. In its announcement, the Montenegrin Ministry reminds of this move by their neighbours.

In Croatia, the VAT on solar panels was 25%, while in Montenegro, the rate is 21%.

Power utility Elektroprivreda Crne Gore (EPCG) has launched the program Solari 3000+ for households and Solari 500+ for companies to speed up the installation of solar power plants on roofs and enable consumers to produce energy for self-consumption becoming prosumers.