As in previous years, the changes in tax structure on the import of electric vehicles (EVs) have courted controversy also this year. The federal budget for FY 2023/24 has increased the tax on EVs of 50-100 KW motor capacity while lowering the tax on EVs above 100 KW. And, anticipating the government move, EV dealers have imported over 1000 EVs of 100 KW capacity just ahead of the budget presentation. While the current fiscal year budget favored EVs up to 100 KW, the new budget has supported EVs above 100 KW that are considered expensive in the market. The new budget has imposed a 5 percent customs duty and 10 percent excise duty on electric vehicles of 50-100 KW, while it reduced the customs duty and excise duty on electric vehicles of 100-200 KW. Similarly, the customs duty has been reduced by only 5 percent for EVs having 200-300 KW capacity. Finance Minister Dr. Prakash Sharan Mahat has defended the budget arrangement on EVs, saying that the tax policy on electric vehicles (EVs) has been rationalized, and a section of EV dealers has questioned the new policy.

In the budget of the current fiscal year, then Finance Minister Janardan Sharma levied excise duty on top of the existing customs duty on EVs above 100 kW capacity. A 30 percent excise duty on EVs with 100-200 KW motors was imposed and a 45 percent excise duty was imposed on the imports of vehicles with electric motors of 201-300 KW capacity, a 60 percent excise duty on vehicles with more than 300 KW motor capacity.

Ahead of the new budget, the EV dealers (a group of importers who sell EVs up to 100 KW) had strongly lobbied with the government urging the Finance Ministry not to change the tax structure. Another group of dealers selling above 100 KW EVs and fuel engine vehicles asked for increasing tax on EVs up to 100 KW. The tax arrangement on EVs in the current fiscal year's budget helped in the market boom of 100 KW EVs. A total of 2,882 EVs up to 100 KW worth Rs 8.09 billion were imported in the 10 months of this fiscal. However, the import of EVs above 100 KW plunged heavily due to the new tax structure that made them costlier in the market. Even before finance minister Dr. Mahat announced the next fiscal year's budget, there were talks of changes in tax structures of EVs and anticipating this, EV dealers dealing with 100 KW EVs have imported 1,145 vehicles in the first two weeks of Jestha. The import of EVs surged dramatically after the leakage of the information that the new budget will increase the tax on EVs up to 100 KW. According to officials at the Department of Customs, the majority of EVs imported in the last two weeks are 100 KW EVs. A total of 805 EVs were imported from the Rasuwa Customs Office within a period of 14 days. According to the Rasuwa Customs Office, most of the vehicles imported from the said customs are up to 100 kW. Of the 1684 EVs imported through this custom point, 805 vehicles were imported in the last two weeks. The officials at Rasuwa Customs said the EVs belonging to MG, BYD, and Neta V brands were imported during this period. Similarly, 24 EVs up to 100 KW have been imported from Totopani Customs. Similarly, 211 EVs were imported through Bhairahawa Customs and 105 EVs from Birgunj Customs during this period. https://gadgetconcern.com/electric-vehicles-price-in-nepal/