Insight

The Power of Nature – Taxation of Wind Power 2020

A country and territory overview

Katherine Breaks

Katherine Breaks

Principal, Tax Incentivized Transactions, Leasing & Energy, KPMG US

+1 202-533-4578

Mike Hayes

Mike Hayes

Global Head of Climate Change & Decarbonization, KPMG IMPACT & Global Head of Renewables, KPMG International

+353 1-410-1656

Glenn Todd

Glenn Todd

Principal, National Tax Leader, Power and Utilities, KPMG US

+1 412-232-1642

We are proud to present the second edition of The Power of Nature – Taxation of Wind Power 2020. In this edition, 9 more countries have been included, bringing the total number of countries covered to 29, including the United States, which represent key wind power producing countries.

Wind power production, both onshore and offshore, is a fast-growing business. It is expected that production of wind power shall continue growing in the future, and increase its share of the global energy mix, as countries all over the world seek to reduce emissions from fossil energy production.

In most countries wind power production is subject to ordinary CIT varying from 12.5 % (Ireland) to up to 40 % (India). Most countries levy CIT on wind power production in the area of 20 % - 25 %. Please note that applicable tax rates may vary due to local regulations, please see relevant country sections for details.

Several countries have accelerated tax depreciation rules for wind power assets, leading to increased profitability for wind power producers. The main incentive behind such rules is to increase renewable energy production and to speed up a transition from fossil energy to green power production

Compensation by way of local taxes is a mean to secure support from local municipalities affected by construction and operation of wind farms. This is commonly obtained through levy of property tax. 

This report intends to present a brief country and territory overview of taxation of both onshore and offshore wind power production.

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