EVs under Rs 50 lakh set to become cheaper: Finance Minister Wagle
Finance Minister Dr. Swornim Wagle, speaking at an interaction with the Nepal Association of Financial Journalists (NAFIJ) today, said that electric vehicles priced below Rs 50 lakh are likely to become cheaper under the government’s revised tax structure.
He noted that a minor calculation issue in earlier discussions has been corrected, particularly in the application of the road development fee, and said the updated framework provides greater clarity in final EV pricing.
Wagle explained that the government has shifted to a value-based taxation system using CIF (customs, insurance, and freight) value, replacing the earlier motor power (kW)-based structure.
Under the revised system, customs duty has been made flat, while the road development fee is set at 2.5 percent for vehicles below Rs 50 lakh and 5 percent for those above that threshold. A 13 percent VAT continues to apply on the final taxable value, along with applicable import-related charges.
He said the move is intended to make taxation more progressive and aligned with the actual import value of vehicles, improving affordability for mass-market EVs while maintaining higher taxation on premium segments.
According to him, EVs below Rs 50 lakh fall within the mass-market category and are expected to see some reduction in final retail prices under the new structure, whereas higher-priced EVs are treated as luxury imports due to their higher foreign exchange outflow.
Wagle also said earlier tax incentives played a key role in accelerating EV adoption in Nepal, but with rising imports, the policy has now been recalibrated to ensure a balance between affordability, infrastructure requirements, and pressure on foreign exchange reserves.
He added that the revised framework aims to support continued EV adoption among middle-class buyers while ensuring that luxury electric vehicles are taxed more in line with their import value and consumption profile.
