Nepal Excise Duty (Antah Shulka) Rate Tables: Liquor, Beer, Cigarettes, Vehicles

Excise duty, called antah-shulka in Nepali, is an internal indirect tax charged on the manufacture or import of specific goods deemed harmful, luxurious or otherwise suitable for extra taxation. In Nepal it is governed by the Excise Duty Act 2058 (2002) and the Excise Duty Rules 2059 (2003), and is administered by the Inland Revenue Department (IRD) under the Ministry of Finance. The Act received the Royal Seal and was published on 2058/10/17 BS (30 January 2002 AD), replacing the older Excise Act of 1958.

The Act itself sets out the legal machinery: licensing, invoicing, warehousing and enforcement. It does not permanently fix the numbers. Instead, the actual rate for each product is set anew every fiscal year through the annual Finance Act (Arthik Ain) that accompanies the budget. This is why an excise figure is only meaningful when tied to a fiscal year, and why the rates on this page carry a fiscal-year label and a 'rates change yearly' caveat.

Nepal collects excise under two administrative systems. Under the self-removal (self-issuance) system, larger established producers assess and pay the duty themselves and remove goods from the factory on their own invoices, subject to audit. Under the physical control system, used for high-risk goods such as liquor, cigarettes and some tobacco, IRD officers physically supervise production and clearance. Anyone producing, importing or selling excisable goods must hold an excise licence from the IRD, renewed annually.

Hard liquor (whisky, rum, gin, vodka and similar distilled spirits) is taxed on a specific basis, meaning a fixed rupee amount per litre rather than a percentage of price. The rate falls as the alcoholic strength falls, and strength is expressed in the traditional 'UP' (Under Proof) scale used in Nepal's schedule: a lower UP number means stronger alcohol and a higher duty per litre. Duty is charged per LP (litre of proof) litre of the finished product.

For fiscal year 2082/83 (2025/26) the headline specific rates on domestically produced spirits were approximately Rs 1,860 per litre for 15 UP, Rs 1,390 for 25 UP and Rs 1,290 for 30 UP strength, with these three top bands broadly unchanged from the prior year. Lower-strength categories were increased: 40 UP rose from Rs 650 to about Rs 690 per litre, and 50 UP from Rs 450 to about Rs 490 per litre. Imported spirits additionally attract high customs duty and 13% VAT on top of excise.

The rates above are the specific excise component only. The final shelf price of a bottle in Nepal stacks several layers on top of the base value: excise duty, customs duty (on imports), VAT at 13%, and industry and retail margins. Because the strength-band structure and the exact figures are revised in the budget most years, treat the numbers here as indicative of the 2082/83 schedule and verify the current year against the IRD rate booklet.

Beer is also taxed on a specific per-litre basis rather than by value. For fiscal year 2082/83 (2025/26) the excise duty on beer was raised by around Rs 15 per litre, from about Rs 240 to about Rs 255 per litre. This rate applies to the finished beer volume and is separate from the 13% VAT and any customs duty on imported brands. In the same budget the government also moved to bring microbreweries formally into the excise-licensed liquor-industry framework.

Wine sits in a middle band, historically around Rs 350 per litre of specific excise, with sparkling wine and higher-value imports facing steeper customs duty. As with spirits and beer, wine also carries VAT at 13% and, for imports, customs duty, so the tax content of a bottle is considerably higher than the excise line alone.

The practical takeaway for beer and wine is that Nepal's excise is volume-based, so the duty per bottle depends on bottle size, not price. A 650 ml beer therefore carries a predictable excise amount regardless of brand, while the customs and margin layers explain most of the price gap between domestic and imported labels.

Cigarettes are taxed on a specific basis per 1,000 sticks, written in the schedule as a rate 'per M' (M = mille = 1,000). The rate rises with cigarette length and with the presence of a filter, so a long filtered cigarette carries several times the duty of a short unfiltered one. For fiscal year 2082/83 (2025/26) the rates were nudged up across the board: unfiltered cigarettes and small cigars rose from about Rs 755 to Rs 778 per 1,000; cigarettes up to 70 mm rose from Rs 1,740 to about Rs 1,792; and the 70-75 mm band rose from Rs 2,370 to about Rs 2,441. Longer filtered cigarettes climb further, with the top bands reaching roughly Rs 5,750 per 1,000 sticks.

Smokeless and processed tobacco is taxed separately. For 2082/83, products such as khaini, surti, pan masala and gutkha were charged around Rs 60 per kilogram of excise, and imported raw tobacco and cigars carry their own lines in the schedule. These specific rates are deliberately set high as a public-health measure to discourage consumption.

On top of excise, Nepal levies a separate Health Risk Tax (also called the health hazard fee) on tobacco and vaping products. For 2082/83 this was about 60 paisa per stick on cigarettes and cigars, 30 paisa per stick on bidi, and Rs 30 per unit on electronic cigarettes and vapes, with heated-tobacco products taxed at 10% of customs value. The health risk tax is additional to the excise duty, so the effective tax burden on a pack combines both levies plus VAT.

Internal-combustion vehicles are taxed by value (ad valorem), with the excise rate rising sharply with engine capacity measured in cubic centimetres (cc). The excise band is applied to the assessable value alongside customs duty and 13% VAT, which is why the on-road price of a large petrol or diesel car in Nepal can be a large multiple of its landed cost. Broadly, motorcycles fall in the 40-80% excise range depending on cc, while cars, jeeps and vans span roughly 60% up to around 300% for the largest engines.

The exact cc thresholds and the excise percentage for each band are set in the annual customs and excise schedule and are among the most frequently adjusted lines in the budget, so precise figures should be read from the current Department of Customs tariff or IRD schedule for the relevant fiscal year. The general principle is stable: small engines are taxed lightly, and each higher cc bracket carries a materially higher excise percentage.

Note the difference between excise duty and the annual vehicle tax you pay at renewal ('bluebook' tax): excise is a one-time import/manufacture duty charged as a percentage of value, whereas the annual vehicle tax is a fixed rupee amount by cc paid every year to the province. They are separate levies and should not be confused when estimating total ownership cost.

For several years Nepal taxed electric vehicles (EVs) on the peak power of their motor, measured in kilowatts (kW), with both customs duty and excise duty rising in steps. Under the structure that applied through fiscal year 2082/83 (2025/26), EV cars up to 50 kW paid 15% customs and 5% excise; 51-100 kW paid 20% customs and 15% excise; 101-200 kW paid 30% customs and 20% excise; 201-300 kW paid 60% customs and 35% excise; and above 300 kW paid 80% customs and 50% excise. VAT at 13% and a 5% road-development levy applied on top.

This kept small and mid-range EVs far cheaper than equivalent petrol cars and helped drive rapid EV adoption. Because the band boundary sits at power thresholds, a vehicle rated just under 100 kW could carry meaningfully less duty than one rated just over, so buyers and importers watched motor ratings closely.

From fiscal year 2083/84 (2026/27) the government restructured EV taxation away from motor power toward vehicle price. The new approach applies a flat customs duty (reported at 20%) and removes the separate EV excise duty, replacing it with a tiered value-based 'Clean Infrastructure Investment Fee' that scales from about 2.5% for affordable EVs up to very high rates (reported above 100%) for the most expensive models, with VAT and the road levy still applying. If you are pricing an EV, check whether the transaction falls under the older motor-power bands or the newer value-based fee for the year in question.

Excise is only one layer of Nepal's indirect-tax stack. For an imported item the usual order is: assessable (CIF) value, then customs duty, then excise duty on the customs-inclusive value, then VAT at 13% on the total, plus any product-specific levies such as the health risk tax on tobacco or the road-development levy on vehicles. A single change in an excise band therefore ripples through the final price because VAT is charged on top of it.

Rates are re-fixed in the Finance Act each Jestha/Ashad (May-June) as part of the federal budget and take effect from the start of the new fiscal year around mid-July. Media summaries published at budget time are useful, but the authoritative figures are the IRD excise rate booklet and the Department of Customs tariff for the relevant year. When in doubt, cross-check the fiscal-year label before relying on any number.

Because these figures move every year, the tables here should be used as a reference snapshot centred on fiscal year 2082/83 (2025/26), with the noted 2083/84 EV change, rather than as a live tax calculator. Always confirm the current rate against the official IRD and Ministry of Finance publications before making a purchase, filing, or import decision.