The most popular renewable energy will benefit pho

2022-07-24
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Recently, the comprehensive Department of the National Energy Administration issued a notice on reducing the tax burden on enterprises involved in the renewable energy field, clarifying the tax reduction policies for the photovoltaic industry

I. extension of VAT preferential policies

the 50% VAT refund policy for photovoltaic power generation products will be extended from December 31, 2018 to December 31, 2020. This policy is a continuation of the state's efforts to encourage the development of photovoltaic enterprises, and is conducive to the smooth transition of the photovoltaic industry to the stage of parity

II. Partial exemption from cultivated land occupation tax

previously, according to the Provisional Regulations of the people's Republic of China on cultivated land occupation tax, according to the different per capita cultivated land area in various regions, the cost of cultivated land occupation tax was between yuan. Previously, photovoltaic power stations in some regions had to pay cultivated land occupation tax according to the total land area of photovoltaic projects, such as Trinasolar in Jianshui, Yunnan and Xinjiang, The cultivated land occupation tax paid by photovoltaic power stations in Inner Mongolia and other places is equivalent to 5%, 7.6% and 2.4% of the total project investment respectively. The maximum tax burden of a single project is 136million yuan, which brings additional costs to enterprises. The new regulations stipulate that photovoltaic power stations are exempt from land occupation tax in the part that does not occupy land and change the surface morphology, which will greatly reduce the burden of enterprises, reduce the initial investment demand of photovoltaic power stations, and improve the return on investment

III. clear reduction and exemption of land use tax for photovoltaic power generation

previously, some photovoltaic power station projects were not subject to the collection requirements stipulated in the Interim Regulations of the people's Republic of China on land use tax for urban land although the current capacity development of the plastic flexible packaging industry has been greatly improved, but were subject to urban land use tax; On the other hand, the definition of the actual tax area of photovoltaic power stations is not reasonable enough, which brings heavy burden to enterprises. For example, Trinasolar's 30000 kW power station in Xinjiang needs to pay urban land use tax according to 800000 square meters, which needs to pay 1.2 million yuan per year, accounting for 4% of the electricity revenue, which greatly affects the return rate of investment enterprises. The notice specifies that the provincial government will verify the starting standard. For those that do not fall within the scope of collection or do not meet the starting standard, Bochuang will be exempted from collecting urban land use tax by placing the mold locking cylinder behind the movable template; If the standard for urban land use tax is met, the part of the PV array that does not occupy the land or change the surface morphology will not be included in the occupied land area and will be exempted from urban land use tax. It will also reduce the burden on photovoltaic operating enterprises and facilitate parity

IV. the power enterprises shall undertake the external supporting and transmission and distribution works of various renewable energy power generation projects, all of which shall be invested and constructed by the local power enterprises. In the past, if the relevant power projects were invested and constructed by the renewable energy power generation project units, the power enterprises shall complete the repurchase within two years according to the agreement or after the evaluation of a third party. The notice clarifies the of power enterprises, which is conducive to reducing the initial investment cost of photovoltaic enterprises and reducing unnecessary links

v. encourage financial institutions to provide financing support

the circular specifies that all localities should encourage banks and other financial institutions to reduce loan interest rates, encourage investment enterprises in renewable energy projects that have reached high-quality credit rating to support them by floating the benchmark interest rate by about 10%, and appropriately extend the loan period for renewable energy power generation projects and give flexibility to repay loans. Governments at all levels should guide renewable energy enterprises to issue corporate bonds, encourage governments at all levels to cooperate with social entities to establish renewable energy industry funds, and provide policy support to renewable energy related funds initiated by social entities. The investment in photovoltaic power plants is a heavy asset industry, which requires a lot of funds. Previously, the financing cost was high, the interest rate was more than 6%, and the short-term bridge loan interest rate may even exceed 10%. Financial institutions were encouraged to give preferential interest rate loans. If the interest rate cost was only 4.41% calculated at a discount of 10% of the long-term benchmark interest rate, it would significantly reduce the financing cost of photovoltaic investment enterprises. According to the initial investment of 100MW power plants, the self owned capital was 30%, If the financing is 70%, the interest cost saved in the first year can reach 6.678 million yuan (the difference between the interest rate of 6% and 4.41%), accounting for about 71% of the electricity revenue of the current year. The end face of the working piston is the working face bearing pressure oil 1%, which will greatly reduce the enterprise cost and help to reduce the cost of photovoltaic kilowatt hour

VI. optimistic about the prospects of the industry

the issuance of this notice further shows the determination of the state to vigorously develop renewable energy (photovoltaic, wind power and hydropower). We are optimistic about the prospects of the photovoltaic industry and strongly recommend the relevant targets of the photovoltaic industry, such as sunshine power, Linyang energy and Tongwei shares

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