KATHMANDU, Nov 27: The government is preparing to relax customs duty on import of electric vehicles (EVs) to promote environment-friendly vehicles and reduce consumption of fossil fuel.
Ministry of Science Technology and Environment (MoSTE) has forwarded a proposal to cabinet to limit customs duty on EVs at 10 percent, according to MoSTE Secretary Chandra Paudel.
Embracing EVs for Sustainable Future
The government is currently levying 40 percent custom duty on four-wheelers and 15 percent on two-wheelers along with 13 percent Value Added Tax (VAT) on both. It levies around 225 percent taxes on vehicles consuming fossil fuel.
“People will be able to afford EVs once customs duty is reduced as per our proposal,” Paudel said. “It will also help in environment conservation as the decision reduces consumption of fossil fuels.”
Paudel says he was hopeful that the cabinet would endorse their proposal.
Last month, National Planning Commission (NPC) had directed concerned ministries to provide tax facilities on import of EVs to reduce import of petroleum products. Taking the decision, NPC had said that few people were using green vehicles as high tax rates were making them expensive in Nepal.
Dealers of electric vehicles have long been demanding that the government reduce taxes on EVs as per its commitment. “Promotion of zero-emission EVs is the need of the hour as the country is reeling under the acute shortage of petroleum products,” Barden Basnet, senior general manager of Agni Energy, said. “However, the government has not translated its commitment into action.”
Agni Energy is the authorized distributor for Mahindra Reva EVs in Nepal.
“We are disappointed this time too as the government failed to bring programs to promote use of EVs in the white paper issued on Tuesday,” added Basnet.
Along with reducing customs duty on EVs, Basnet said the government should adopt long-term policies and announce subsidy to encourage use of EVs.
He also said proposed reduction in customs duty will make Mahindra e2o cheaper by around Rs 400,000. The vehicle is currently available at Rs 2.5 million
Different brands Chinese and Indian electric two-wheelers are also available in the market.
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