Montenegro may follow Croatia’s example andabolish the taxon value added tax (VAT) on solar panels, as governments in the region increasingly recognize the importance of rooftop solar power plants on homes and businesses as a measure to address the energy crisis.
The Ministry of Economic Development and Tourism of Montenegro announced that it is preparing a new package of measures to ease the pressure of the energy crisis in the coming months. One of the measures to be proposed to Finance Minister Aleksandar Damjanović will be the abolition of VAT on solar panels.
According to Minister of Economic Development and Tourism Goran Đurović, abolishing VAT on solar energy is aimed at a faster transition to renewable energy sources. It will also improve supply reliability in the long term and help citizens and the economy in the event of market disruptions and low water levels in hydropower reservoirs.
The Croatian government was the first in the region to abolish VAT on solar panels in order to accelerate the energy transition and ensure electricity supply. In its statement, the Montenegrin ministry refers to this move by its neighbors.
In Croatia, VAT on solar panels is 25 percent, while in Montenegro the VAT rate is 21 percent.