Push to Prolong Air Conditioning Tax at 6% Rate
Let's Talk about Portugal's VAT Hike and Its Implications
The Portuguese Installers Association (AIPOR) is ruffling some feathers, calling for a 6% IVA tax rate on air conditioning equipment and solar panels to remain intact instead of jumping to the standard 23%. This decision, set to take effect starting July 1, 2025, could be a real game-changer, impacting the affordability and adoption of energy-saving solutions.
Slapping a 23% IVA rate onto air conditioning equipment, thermal or photovoltaic solar panels, and wind turbines will surely send Euro signs flying everywhere, increasing initial costs for consumers and businesses. Folks might find these environmentally friendly options less accessible, and that's the last thing we need when rapidly decreasing carbon emissions is crucial for future generations.
The lower 6% IVA rate has been the government's friendly secret weapon since 2021, covertly nudging Portugal towards renewable energy and a healthier planet. But when the good times end, the bill comes due, and European and global commitments to energy efficiency and sustainability are on the line, it becomes vital to encourage this market and these conscientious consumers.
That's AIPOR's main message. They think extending the reduced VAT rate is key to making it financially feasible for people to adopt eco-friendly practices. Today, the high VAT rate equation equals a higher barrier for buying the goods, and AIPOR says the writing's on the wall: we need cheap, clean, and efficient technology more than ever.
"We're in a critical carbon-battling time, and we must encourage the market and consumers," AIPOR president Celeste Campinho argues. "This VAT bump could strain household wallets, potentially limiting the spread of renewable energy."
By keeping the IVA rate low, the government would continue to pump the brakes on carbon emissions, encourage energy efficiency, and uphold.the momentum of Portugal's climate policies. AIPOR draws the line: extend the reduced IVA rate to support ongoing decarbonization efforts and herald a green future in line with national and EU climate commitments.
The Portuguese Installers Association (AIPOR) argues that maintaining a 6% IVA tax rate on air conditioning equipment and solar panels is crucial for encouraging the adoption of renewable energy and energy-saving solutions. An increase to a 23% IVA rate, as planned for July 2025, could make these environmentally friendly options less accessible, contrary to the goal of decreasing carbon emissions. AIPOR contends that keeping the IVA rate low would support ongoing decarbonization efforts, foster energy efficiency, and align with national and EU climate commitments. Celeste Campinho, AIPOR's president, emphasizes the need to encourage the market and consumers during this critical time for battling carbon emissions, warning that the potential strain on household wallets could limit the spread of renewable energy.
