Preliminary investigations suggest a categorical yes!
Let us understand this better:
With the new GST rules, the GST paid is not part of the capital cost of the system installed. In the earlier regime, we could not claim the credit of the GST or the Sales Tax paid because there was a segregation between capital purchase sales tax and operational revenue sales tax. Now it is not so. There is no segregation between the Sales Tax or GST of capital purchase or the Sales Tax or GST of operational revenue. So, the GST paid on the capital purchase can be fully taken credit of from the GST payable on the company’s revenues. In the case of solar, Sales Tax rates were in the 5% range so there is a straight away 5% reduction in the capital cost of the system. This makes payback periods more attractive
If you are using petroleum products including Furnace Oil, the GST paid on them are not allowed to take credit from your GST on revenues. That means the entire sales tax paid is a cost – that you cannot claim the credit of against your tax payable on revenues.
40% Accelerated Depreciation is continuing – and availing this can reduce the capital cost
Overall, there is never a better time for switching to solar heating or efficient heat pumps. If you have heating processes that require below 100 degrees C and are using electricity, furnace oil, diesel or LPG, time is NOW for you to switch.