KATHMANDU: The Bagmati Province government has announced multiple tax relief measures for vehicle owners in the current fiscal year 2025/26. The provisions are included in the provincial Finance Act and decisions of the Council of Ministers.
The relief covers vehicle tax, renewal fees, route permits, vehicle inspection, and related penalties. The validity period differs by category. Here are the six major tax relief measures announced for this fiscal year.
- Pay for three years, remaining dues to be waived
Under the Finance Act, vehicle owners who have unpaid vehicle tax and renewal fees for any number of years before FY 2025/26 can clear all past dues by paying tax for the last three fiscal years along with the current year by June 14, 2026.
All taxes, renewal fees, and penalties prior to those three years will be waived. However, penalties applicable under existing laws for the last three years and the current year will still apply.
- Penalty waived for deregistering old public vehicles
Public vehicles registered in Bagmati Province that are 20 years old or older can be deregistered by paying outstanding vehicle tax and renewal fees for up to 20 years by June 14, 2026.
All penalties applicable to those dues will be waived. This provision has been introduced through the Finance Act.
- Government vehicles to receive revenue waiver
The province has waived outstanding revenue liabilities for government-owned vehicles that are no longer operable and cannot be restored through maintenance.
With approval from the concerned ministry overseeing transport management, such vehicles can be removed from records with full revenue waiver. Offices owning deregistered vehicles are also allowed to auction them.
- Vehicles damaged in Gen Z protests to receive tax exemption
Vehicles completely damaged during the Gen Z protests held on September 8 and 9 will receive tax relief. The decision was made by the provincial cabinet on December 31.
Such vehicles will be exempt from annual vehicle tax and renewal fees for FY 2025/26 for record cancellation purposes. The exemption applies to government, public, board, tourist, and private vehicles.
- No penalty charged during office closure period
Vehicle owners who missed renewal deadlines for route permits or vehicle inspections due to transport offices being closed during the Gen Z protests will not face penalties.
If renewal fees are paid by February 13, 2026, penalties for the service disruption period from September 8 until services resumed will be waived. The Cabinet approved this decision on December 31, 2025.
- Renewal and penalty waiver for workshops and reconditioning businesses
Transport-related training centers, factories, workshops, and reconditioning houses registered in the province but not renewed can regularize their status by paying the latest renewal fee by June 14, 2026.
All renewal fees and penalties for previous periods will be fully waived under the Finance Act.
