Business tax rates for rooftop solar installations could rise by up to eight times next year.
The solar industry is calling on ministers to intervene on the hike, which will “all but eliminate the incentive for businesses to invest in solar”, the Solar Trade Association (STA) claimed.
Public authorities, schools and community buildings that have solar on their roofs are also at risk if the expected rise comes into force on 1 April 2017. The change is due to a wider evaluation of commercial rates that takes place every five to seven years.
STA chief executive Paul Barwell said: “This is a huge increase in the running costs of a rooftop solar installation that will affect both existing and new projects. In some cases, it would actually send installations into negative returns.
“Ministers must act now, otherwise this tax rise will all but eliminate the incentive for businesses to invest in solar.”
The association also said that the considered rates “bear little relation” to the revenue generated by the installations as of next year, and are based on “fixed assumptions about capital costs of installation”. However, the way business rates legislation is worded is the issue and requires attention from government.
The STA has been in talks with the Valuation Office Agency, the Treasury, the Department for Communities and Local Government, and the Department of Energy and Climate Change to discuss our proposals to exempt self-owned rooftop solar from business rates.
Earlier this week, the STA launched an initiative to raise standards in the maintenance of large rooftop and ground-mounted solar systems.
