The price of electric vehicles below Rs 5 million is decreasing, a small footnote is missing in the budget, we are correcting that. Subsidies cannot be given for luxury vehicles: Finance Minister Wagle
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Finance Minister Swarnim Wagle has said that it is not possible to 'subsidize' electric vehicles (EVs) worth Rs 10 million by considering them as 'luxury'. At a program organized by the Nepal Association of Economic Journalists (NAFEJ) on Monday, Wagle clarified that even though the policy is to encourage the middle class to buy EVs, luxury is still considered a luxury.
'The price of electric vehicles under Rs 5 million is decreasing, a small footnote is missing in the budget. We are correcting that,' he said, 'The road construction fee is being halved. The lowest one is 2.5. The rest is 5 percent.'
Wagle said that all types of vehicles will have 20 percent customs duty and 13 percent value-added tax (VAT). 'There is a foreign exchange privilege. If you buy a petroleum vehicle worth $ 8/10 thousand, you will pay 250 percent tax, which will be about Rs 4 million,' he said, 'Foreign exchange has been flowing out a lot for electric vehicles worth Rs 40/50 lakh. I also bought an electric vehicle when the tax was 24.3 percent. There was 10 percent customs duty and 13 percent VAT. That was right at that time. We made it cheaper. That's why EVs have increased now. Now we have to go to the second phase.'
Discussions are underway on electrifying public vehicles and e-mobility can be used through Kathmandu Vision 2040, says Finance Minister Wagle. 'Passenger vehicles can also go. But the adoption rate should be increased. But those who ride an EV worth 10 million should accept it as a luxury item. It is a luxury.'
Finance Minister Wagle reiterated that luxury vehicles cannot be 'subsidized' by using the foreign exchange sent from the Gulf with difficulty. 'EV adoption should also be increased. But a responsible government should balance the painful choice,' he said. 'A vehicle with a cost of 20 million, insurance and transportation (CIF) would probably cost 42/43 lakh even after adding all taxes. Calculate.'
Finance Minister Wagle also commented that Prime Minister Balendra Shah did not increase the tax on vehicles below Rs 50 lakh and said that vehicles above that are luxury items. He claims that those who do business honestly are happy with this. Now, Wagle said that all the fuss about not seeking leaders due to the kilowatt dispute, the Accountant General being chased, and the like is over. 'No matter how clean it is, where should we dispose of the battery? The plastic content is high, that is why we have imposed the Clean Infrastructure Investment Fee (CIIF),' he said.
