Income Tax Credit for Persons Who Acquire and Install Solar Photovoltaic System

• The House of Representatives, on Tuesday (July 9), passed the Income Tax (Amendment) Act, 2024, which seeks to implement a regime to provide income tax credit to individuals who acquire and install a solar photovoltaic system at their primary place of residence.
• Minister of Finance and the Public Service, Dr. the Hon. Nigel Clarke, had informed of the initiative during his 2023/24 Budget presentation. “This Bill seeks to achieve this by setting out the appropriate legal framework that would allow individuals to benefit from this income tax credit,” he added.
• "This measure forms part of a much broader goal of reducing our dependence on fossil fuels and substantially increasing the share of renewable energy in our local energy mix,” Dr. Clarke told the House. The Minister highlighted that Jamaica aims to attain a 50 percent renewable energy share in electricity generation by 2030, emphasising the crucial role of targeted fiscal policies in reaching this goal.
• The Minister said that the major components utilised in the installation of a solar photovoltaic system, such as the solar photovoltaic panels, solar inverters, and solar batteries, including lithium-ion batteries, are also exempt from the payment of General Consumption Tax (GCT). He further highlighted that the fiscal measures are proof of the Government’s commitment to achieve the target of 50% use of renewables by 2030.”
• Additionally, the Bill provides for an income tax credit, among other benefits, at a rate of 30% of the acquisition and installation costs of a solar photovoltaic system for the taxpayer's primary residence, with a cap of $4Mn. According to Clarke, this means that the maximum credit an individual will be allowed to claim is $1.2Mn.

 (Source: JIS)