Did electric vehicles get more expensive in Nepal's 2083/84 budget?

It depends on the price of the EV. The cheapest models, with an import (CIF) value up to Rs 20 lakh, rose only slightly, by roughly Rs 1 lakh, because customs went from 15% to a flat 20% while excise was replaced by a small 2.5% fee. Mid-range and premium EVs got steeply costlier: the new value-based fee climbs to 35%, 90%, and 130% for higher import values, so high-end models can rise by more than Rs 40 lakh. The era of cheap premium EVs in Nepal is over; cheap small EVs survive.

How is EV tax calculated in Nepal now?

From the FY 2083/84 budget, EV duty is based on the vehicle's CIF (import) value, not its motor power in kW. Every EV pays a flat 20% customs duty. Excise duty was abolished and replaced by a Clean Infrastructure Investment Fee that rises with value: 2.5% up to Rs 20 lakh CIF, 20% from Rs 20 to 30 lakh, 35% from Rs 30 to 40 lakh, 90% from Rs 40 to 50 lakh, and 130% above Rs 50 lakh. A 5% road-construction fee and 13% VAT still apply on top.

What is the Clean Infrastructure Investment Fee?

It is a new value-based fee on imported EVs, introduced in the FY 2083/84 budget to replace the old excise duty. The government says it will fund charging stations, battery management, and domestic EV assembly. It is charged on CIF value in five bands from 2.5% to 130%, and it is the single biggest reason premium EVs got more expensive while the customs duty itself stayed modest at 20%.

When did the new EV duty take effect?

On Jestha 15, 2083 (29 May 2026), the day the budget was presented, not the start of the fiscal year. Nepal's provisional tax-collection mechanism lets customs and duty changes apply from budget day, so EVs cleared through customs on or after 29 May 2026 fall under the new structure. There is also reporting that EVs imported before the budget but not yet registered may be caught by the new fee, which is worth confirming with your dealer before you commit.

Which EVs got cheaper and which got costlier?

Nothing got cheaper. The cheapest tier, EVs with CIF value up to Rs 20 lakh, stayed roughly flat or rose about Rs 1 lakh. Everything above that climbed: industry estimates put the total tax burden at around 43-46% for entry models, about 70% for mid-range, around 92% up to Rs 40 lakh CIF, and 156% or more for the most expensive imports above Rs 50 lakh CIF. The fee is steeply progressive, so the more the EV costs to import, the harder it is hit.

Did petrol and diesel car taxes change in the budget?

No EV-style restructuring of petrol or diesel passenger-car duty was reported in this budget. The vehicle-tax overhaul was specific to EVs. The budget did cut customs on fuel imports by half from Jestha 15, which affects pump prices rather than the cost of buying a petrol car. Treat the absence of an ICE-car duty change as not-reported rather than formally confirmed; check the gazetted schedule if you are buying a petrol vehicle.

Nepal EV Tax 2083/84: kW-to-Value Duty Switch

A friend had a BYD Atto 3 on order through Dashain and kept pushing the booking back, betting that prices would keep falling the way they had for three years. The budget on Jestha 15 ended that bet in an afternoon. The way Nepal taxes electric cars was rebuilt from the ground up, and the change does not move every model in the same direction.

The headline is simple to say and harder to feel: duty is no longer about how powerful the motor is, it is about how much the car costs to import. For a cheap hatchback EV that barely registers. For a loaded SUV it is the difference of several lakh. This post lays out the old system, the new one, and who actually pays more.

The old system: tax by motor power

Until this budget, Nepal taxed an EV by the peak power of its motor, measured in kilowatts. The bigger the motor, the higher the customs and excise. The structure that ran through FY 2082/83 looked like this:

Motor power	Customs duty	Excise (reported)
Up to 50 kW	15%	~5%
51–100 kW	20%	~15%
101–200 kW	30%	~20%
201–300 kW	60%	~35%
Above 300 kW	80%	~50%

The customs column is well documented; the exact excise figures vary a little between sources, so read them as reported rather than gospel. The logic rewarded small motors, and that is exactly where it broke. As myRepublica reported, importers were detuning motors on paper to land a powerful, expensive car in a lower kW band and pay less duty. A Rs 60 lakh car declared at 99 kW paid far less than its size suggested. The government's fix was to stop taxing the spec sheet and start taxing the invoice.

This favourable regime is why EVs took over so fast. They hit 73% of all four-wheeler imports in the year to mid-July 2025, one of the highest rates anywhere, with BYD and Tata leading. The running-cost case for an EV over petrol still holds. What changed is the sticker price on the way in.

The new system: tax by price

From this budget, the Kathmandu Post confirms two moves. Customs duty is now a flat 20% on the CIF value of every EV, regardless of motor size. And the excise duty is abolished entirely, replaced by a new Clean Infrastructure Investment Fee that scales with value:

CIF (import) value	Clean Infrastructure Investment Fee
Up to Rs 20 lakh	2.5%
Rs 20–30 lakh	20%
Rs 30–40 lakh	35%
Rs 40–50 lakh	90%
Above Rs 50 lakh	130%

A 5% road-construction fee and 13% VAT continue on top of both. One caution on reading this table: the bands are on CIF value, the price the car lands at the border, not the showroom sticker you pay. Showroom price already has all of this duty baked in, so it runs well above CIF. A car that retails at Rs 60 lakh may have a CIF value closer to Rs 25 to 30 lakh, putting it in the 20% fee band, not the 130% one. Do not read your own car's showroom price straight off this table.

These follow the Ministry's clarification, which matters because the bill had a rocky first day. The first version of the Economic Bill was pulled from the Ministry of Finance website for leaving out the Rs 20 to 30 lakh band, then re-uploaded once the Ministry confirmed that band sits at 20%. Read the table as the structure, not the last decimal. Some outlets print the top bands as a standalone fee of 35, 90, and 130 percent; the bill's own wording can be read as a smaller fee of 15, 70, and 110 percent with the 20% customs added on to reach the same totals. The all-in burden in the next section is the number that actually decides your price, so lean on that rather than any single band's label.

Who wins and who loses

Nobody's EV got cheaper. The question is only how much costlier, and that depends on import value. Industry estimates collected by Fiscal Nepal put the total tax burden, all duties and VAT stacked, at roughly:

Segment (by CIF)	Total tax burden	Rough price impact
Entry (up to Rs 20 lakh)	~46% (from ~43%)	up about Rs 1 lakh
Mid-range	~70%	moderate rise
Up to Rs 40 lakh	~92%	steep rise
Premium (above Rs 50 lakh)	156% and up	Rs 40 lakh or more

The small-EV buyer barely feels it. Customs went from 15% to 20% on the cheapest tier, and the new 2.5% fee is gentle, so a Tata Tiago EV or a BYD entry model nudges up by around a lakh rather than jumping. The premium buyer feels everything. A high-value import that once exploited a low kW declaration now pays 20% customs plus a 130% fee plus the road fee plus VAT, and the compounding lands somewhere past 150% of the import value. That is the deliberate design: keep mass-market EVs reachable, stop subsidising luxury ones.

For the models people actually shop, the pre-budget showroom prices were roughly Rs 27 lakh for a Tata Tiago EV, Rs 41 lakh for a BYD Dolphin, Rs 49 lakh for a Tata Nexon EV, and Rs 57 lakh and up for a BYD Atto 3. The cheap end of that list holds close to where it was. The Rs 50 lakh-plus end is where the new fee bites, and exact new stickers depend on each model's CIF, which dealers reprice case by case. Ask for the new on-road quote in writing rather than assuming last month's price.

When it takes effect

This is the detail that catches people. The change did not wait for the new fiscal year. Under Nepal's provisional tax-collection mechanism, the customs and duty sections of the Finance Bill took effect on Jestha 15, 2083 (29 May 2026), the day the budget was read. An EV cleared through customs on or after that date pays the new way.

There is also reporting that pre-budget EV imports sitting unregistered may be pulled into the new fee. That one is not fully confirmed, so if you have a car in transit or unregistered in a yard, get your dealer to confirm in writing which regime applies before you pay the balance.

The fine print

A few things are not yet nailed down, and the post does not pretend otherwise:

The fee's upper bands are reported two ways. Whether 35, 90, and 130 percent are the fee on its own or the fee plus the 20% customs varies between sources, and the Rs 40 to 50 lakh band is quoted as either 70 or 90 percent. The all-in burden figure is more reliable than any single band's label.
The green tax rate. The budget merged the old infrastructure development tax and the road maintenance fee into a single "green tax" at customs. That the merger happened is confirmed; the exact rate was not published in readable form, so treat any specific green-tax percentage you see as unverified.
The old excise figures. The old customs bands (15 to 80%) are solid. The matching excise percentages differ slightly across sources, which is why the table above marks them as reported.
Petrol and diesel cars. No restructuring of ICE passenger-car duty was reported, but no source explicitly confirmed "no change" either. If you are buying petrol, check the gazetted schedule.
The gazetted Economic Act. All figures here come from the Ministry's clarification and national reporting, not from a clean read of the final gazette. They are the best available, and they are the corrected set, but the gazette is the last word.

What you actually need to know

Duty is now about price, not power. Flat 20% customs on CIF value, excise gone, and a Clean Infrastructure Investment Fee from 2.5% to 130% that rises steeply with import value. The bands are on CIF, not the showroom sticker.
Cheap EVs survived; expensive ones did not. Entry models rose about a lakh. Premium imports above Rs 50 lakh CIF can cost Rs 40 lakh more. If you want a small urban EV, the math still works; if you wanted a loaded one, the window closed.
It already applies. The new duty took effect on budget day, Jestha 15, not in mid-July, and may reach unregistered pre-budget imports. Get any quote in writing.

If you are weighing a specific model and want help separating CIF from showroom price in a dealer quote, email parjanya57@gmail.com with the quote breakdown and I will work through where the new fee lands.

This post is part of the Nepal Money Basics guide — the big-ticket decisions section. For the rest of the budget, see what got cheaper and costlier and the budget overview.