Nepal Upholds Current EV Tax Rates in 2025/26 Budget

Nepal will maintain its current tax and duty structure on electric vehicles (EVs) for the upcoming fiscal year 2025/26. 

Presenting the national budget on Thursday, May 29, Finance Minister Bishnu Paudel said: “To promote the adoption of electric vehicles, reduce environmental pollution, and increase domestic electricity consumption, all existing taxes and duties on EVs will remain unchanged.”

In Photos: EVs Flood Chobhar Dry Port Amid Whispers of Possible Tax Hike

Additionally, Paudel announced that importers of equipment necessary for setting up EV charging station manufacturing or assembly facilities will pay only a 1% customs duty. These enterprises will also benefit from a full exemption on all other taxes and a five-year income tax holiday.

The private sector has consistently lobbied against higher taxes on EVs, emphasizing their environmental and economic advantages. Despite these calls, many importers rushed to stockpile electric vehicles in recent weeks amid fears of a potential tax hike.

A year ago, the government had raised taxes on EVs for the current fiscal year, 2024/25. EVs with power outputs below 50 kilowatts were subject to a 15% customs duty and a newly introduced 5% excise duty. Vehicles with outputs of up to 100 kilowatts faced a 20% customs duty and a 15% excise duty.

Click  here  to see out budget 2025/26 coverage.