KATHMANDU: The government has removed excise duty on electric vehicles. The change comes through the Economic Act 2026, introduced to implement the budget for FY 2026/27.
Finance Minister Dr. Swarnim Wagle announced a new tax structure. EV taxes will no longer be based on motor power. Instead, they will now be calculated based on vehicle value.
A new charge called the ‘Clean Infrastructure Investment Fee’ has been introduced. It will be applied at the import point. The fee aims to support EV production, charging infrastructure, and battery management.
As per the new structure, EVs priced up to Rs. 2 million will attract a 2.5% fee. Vehicles in the Rs. 3–4 million range will face an additional 15%, taking the total to 17.5%.
EVs priced between Rs. 4-5 million will be taxed an additional 70%, bringing the total to 72.5%. For EVs above Rs. 5 million, the tax rises sharply, with an additional 110%, resulting in a total of 112.5%.
The tax rate for EVs priced between Rs. 2-3 million has not been specified. It may be updated later, as it appears to be missing from the current Economic Act.
