Electric vehicle (EV) prices in Nepal are expected to rise significantly following the government’s new tax changes announced in the upcoming fiscal year 2083/84 budget.
According to the Economic Bill 2083, the government has removed the earlier excise duty on electric vehicles and introduced a new Clean Infrastructure Investment Fee (CIIF). In addition, a 20% customs duty, 5% road construction fee, and 13% VAT will now apply to all EV imports. The tax structure is calculated based on CIF (Cost, Insurance, and Freight) value in Nepali currency.
Under the new system, EVs are now divided into multiple price-based tax slabs. Vehicles priced up to Rs 20 lakh will face a 2.5% CIIF, while those priced between Rs 20–30 lakh, 30–40 lakh, 40–50 lakh, and above Rs 50 lakh will be taxed at 20%, 35%, 90%, and up to 130% respectively.
Industry experts warn that this restructuring will directly increase EV prices by anywhere between Rs 2 lakh to Rs 1 crore depending on the model. Former NADA Automobiles Association President Dhruv Thapa said that expensive vehicles will see the sharpest price jump, while even entry-level EVs will become costlier.
Dealers also criticized the shift from motor power-based taxation to value-based taxation in Nepali rupees, arguing that exchange rate fluctuations will now directly impact vehicle pricing. They say this could make EV pricing unstable, similar to commodities like gold or fuel.
For popular models, distributors estimate significant price hikes. Some EVs like BYD Atto 1 could become costlier by Rs 3–5 lakh, while other models may see increases of up to Rs 2–4 lakh or more depending on specifications and import value.
Industry stakeholders have expressed concern that the new tax structure may discourage EV adoption at a time when Nepal is trying to promote clean energy and reduce petroleum imports. Former Energy Minister Kulman Ghising also warned that the policy could slow down EV expansion and contradict national energy goals.
Experts further argue that the wide tax slabs, especially the steep jump up to 130% CIIF, could discourage imports of mid- and high-end electric vehicles altogether. Some businesses fear demand may drop sharply as prices become unpredictable due to currency fluctuations.
Overall, while the government aims to raise revenue and structure the EV market more systematically, the new tax regime has sparked debate over affordability, market stability, and the future of electric mobility in Nepal.
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