Cassandra Sweet of the Wall Street Journal reported that companies that have contracted to buy solar panels with Chinese-made solar cells must now pay a retroactive solar tax. This will drive the price for solar panels up because the tax ranges from 31% to 250%.
This tax was imposed because American solar cell manufacturers complained to the federal government about China selling their solar cells below market prices. China could do this because their government subsidies the industry. Yet there was an advantage for American consumers because it drove down solar panel prices and resulted in a market oversupply.
Unfortunately, the decision of the Obama Administration to impose this solar tax does not combat or weaken the hold of Chinese-made solar cells on the American market because American businesses pay the tax. In addition, the Obama Administration made the tax retroactive so that businesses that already purchased solar panels with Chinese-made solar cells now face an unexpected tax burden.
Rather than a solution, the Obama Administration created a trade war with China which doesn’t hurt China, just American businesses and consumers. Its green energy policy will suffer a set back through the tax. Consumers always look for bargains. The new solar tax is another example of the faulty thinking of this administration.