Customs Duty on Importing Products in Nepal

Customs Duty on Importing Products in Nepal

Importing goods into Nepal requires an understanding of the various customs duties and taxes applied to different products. This guide provides detailed information on customs duties for common imported products such as biscuits, groceries, mobile phones, cars, and buses.


Groceries

  • Variable Import Duty:
    • Machinery or agricultural goods: ≤ 5%.
    • Paddy: 5%.
    • Rice: 8%.
    • Lentils and legumes: 10%.
  • Additional Taxes:
    • 13% VAT on most vegetables and fruits.
    • 9% Agricultural Service Tax and 5% Advance Income Tax on imported vegetables and fruits.
  • Exemptions: Some basic groceries are VAT exempt.

Customs duty on groceries is based on their transaction price, supported by bills, invoices, and other necessary documents for verification.


Biscuits

  • Import Duty: 30% for both SAARC and non-SAARC countries.
  • HS Code: 19053100 (sweetened biscuits not containing cocoa).
  • Value-Added Tax (VAT): 13% on the CIF (Cost, Insurance, and Freight) value plus customs duty.
  • Total Applicable Duty Rate:
    • Imports from India: 45.21% (30% import duty + 13% VAT).
    • Imports from other SAARC and non-SAARC countries: 46.9%.

Biscuits do not qualify for reduced import duty rates applicable to essential machinery or agricultural products.


Mobile Phones

  • Import Duties and Taxes:
    • iPhones and smartphones > Rs 100,000: Rs 10,000 per phone.
    • Smartphones < Rs 100,000: Rs 3,000 per phone.
    • Feature phones: Rs 300 per phone.
  • Exemptions:
    • Returning migrant workers after 6+ months of legal employment abroad: 1 new smartphone duty-free.
    • Other travelers: 1 phone duty-free.
  • Mobile Device Management System (MDMS): Unregistered phones barred from Nepali telecom services after 15 days. Registration requires IMEI number, passport, and visa.



Cars

  • Customs Duty: 40% to 80% of CIF value, depending on engine capacity and fuel type.
  • Excise Duty: 10% to 80%, based on engine size and type.
  • VAT: 13% of the total value (CIF value + customs + excise duties).
  • Electric Vehicles:
    • Up to 100 kW: 10% customs duty.
    • 100 kW to 200 kW: 15% customs duty.
    • 200 kW to 300 kW: 40% customs duty.

Buses

  • Diesel Buses: Up to 80% customs duty of the CIF value.
  • Electric Buses:
    • Customs Duty: 1%.
    • VAT: 13%.
    • Additional Fees: 5% tax, number plate charges, and administrative fees.

Key Points

  • Transaction Price Verification: Importers must submit bills, invoices, and necessary documents for customs verification.
  • Annual Budget Announcements: Changes in import tariffs, duties, and taxes are usually announced through the annual budget.