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ECONOMY

New tariff regime targets import substitution push, boost domestic industries

The government has introduced a 5%–15% import protection levy on more than 200 goods to promote domestic industries across agriculture, forestry, manufacturing, and construction sectors.
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By REPUBLICA

KATHMANDU, May 30: The government has introduced a range of import protection measures aimed at promoting domestic production across key sectors including agriculture, forestry, footwear, construction materials, and furniture.



Through the Economic Bill 2083, an “internal production promotion and protection fee” will be levied at customs points on imported goods that have domestic substitutes. The policy is intended to make local products more competitive by increasing the cost of competing imports.


Under the new provision, more than 200 domestically produced goods falling under eight Harmonized System (HS) codes will be subject to import duties ranging from 5% to 15%.


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Dairy products will face a 10% levy on imports, which the government says is aimed at strengthening local production and market resilience. Imports of tea and coffee will also be taxed at 10% to support domestic producers of the two cash crops.


A wide range of spices—including pepper, turmeric, chilli, timur, cinnamon, ginger, and bay leaves—will attract duties between 5% and 15%.


Forest-based and plant-derived products will also be affected. Imports of bamboo and nigalo used in handicrafts will be taxed at 10%, while cotton and bidi leaf materials will face duties ranging from 5% to 15%. Timber, firewood, and plywood imports will also attract similar charges.


The footwear industry will see import levies of 7% to 15% on raw materials such as soles and related components, while construction materials including tiles, blocks, marble, and granite will be taxed between 10% and 15%.


Furniture, home décor, and mattress-related imports will also face a 10% levy under the new system.


Officials say the measures are designed to encourage import substitution and strengthen domestic industries by making locally produced goods more competitive in the market.


 

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