The electric vehicle market has experienced growth worldwide in the past few years with more car manufacturers prioritizing electric powertrains instead of traditional internal combustion engines that rely on fossil fuels. This trend, towards mobility, is also evident in Nepal’s emerging market for vehicles (EVs). Although in its stages there is a growing interest in and sales of EVs in Nepal due to concerns about increasing fuel costs and the detrimental effects of vehicle emissions, in urban areas.

According to the Department of Customs,

In the last fiscal year 2022-23, the country imported 10,964 units of four- and three-wheelers worth Rs12.51 billion.

“The demand for EVs is soaring. Market enquiries are better than expected,” said Dhurba Thapa, president of the Nepal Automobile Dealers’ Association.

According to him, the sales ratio of EVs and internal combustion engine vehicles is now 60:40. “If this trend continues, EVs will replace petrol-diesel vehicles in no time,” Thapa said.

People are still testing if EVs can be viable options to combustion engine vehicles while automobile dealers are providing battery warranty of eight years. Automobile dealers said that affordable prices, banking finance of up to “80 percent” and the increasing number of charging stations have been attributed to the boost in EV sales in Nepal.

TAXES CHANGES IN FISCAL YEAR 2022/2023

However, the government changed its policy in the current fiscal year.

The customs duty on EVs below 50 kW is 10 percent.

For 50–100 kW EVs, the customs and excise duties are 15 percent and 10 percent, respectively.

For EVs of 100–200 kW, the customs and excise duties are 20 percent each.

For EVs in the 200–300 kW range, the customs and excise duties are 40 and 45 percent, respectively.

For 300 kW EVs, the customs duty is 60 percent.