The GST Council may reduce GST on parts used in Small Modular Reactors (SMRs) from 18% to 5%. This change will support India’s nuclear expansion plans and encourage private sector participation in the industry.
The Department of Atomic Energy stated that a proposal for a lower GST rate for SMR components has been submitted. This proposal was developed as per the Ministry of Power and has been sent to the Ministry of Finance for consideration.
Currently, SMR components are levied with an 18% GST rate. A 5% reduction could assist in reducing the costs of the project and make the development of small modular nuclear reactors more profitable.
SMRs are a crucial part of India’s strategy to expand its nuclear power capacity. At present, India has around 8.78 GW of installed nuclear power capacity, which is anticipated to increase to nearly 22 GW by 2031-32.
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The target of the nation is to reach its nuclear power capacity to 100 GW by 2047. SHANTI Act, 2025, has been legislated by the government as part of its measures to assist this long-term expansion and to encourage more private participation in the nuclear energy sector.
Investment in the sector will be boosted by a reduced GST on SMR components, supporting the nation in enhancing the development of nuclear projects. The proposal must be considered and approved by the GST Council before any revision in the implementation of the tax rate.
