Fiscal Nepal
First Business News Portal in English from Nepal
KATHMANDU – The Government of Nepal has increased excise duty on cigarettes, alcohol, and beer as part of the national budget for fiscal year 2083/84, aiming to boost revenue and strengthen tax administration.
Presenting the budget in Parliament, Finance Minister Dr. Swarnim Wagle announced that excise duty on cigarettes has been increased by around 10 percent. While the exact adjustments for alcohol and beer were not detailed in the budget speech, the government confirmed that rates have been revised upward.
The government also announced plans to introduce a framework law for non-tax revenue mobilization to improve efficiency in revenue collection and fiscal management.
The budget includes several targeted tax relief measures. Customs duty exemptions will be provided on raw materials imported for industries producing prosthetic limbs and disability assistive devices within Nepal.
Similarly, taxpayers will be allowed to deduct up to Rs 10,000 of residential home insurance premiums for income tax purposes.
To support infrastructure development, the government has exempted capital gains tax on land transactions up to the government valuation limit during land acquisition for development projects.
In a bid to promote industrial growth, the government has introduced a full income tax exemption for the first 10 years for agriculture processing industries. Additionally, import of machinery for cold storage, packaging, and testing laboratories will be exempt from value-added tax (VAT).
The government has also introduced a policy to legalize and regulate domestic alcohol production through licensing of micro-breweries in the upcoming fiscal year.
Finance Minister Wagle said that domestically produced alcoholic beverages will be brought under the excise duty system to ensure proper regulation and revenue collection.
The new fiscal measures reflect the government’s dual focus on revenue expansion and targeted industrial incentives, while tightening regulation of excisable goods and encouraging formalization of domestic production.
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