KATHMANDU: The government has decided to retain the current customs and other tax rates on electric vehicles (EVs) in the fiscal year 2025/26, putting to rest recent speculation about potential hikes.

While presenting the annual budget on Thursday, Finance Minister Bishnu Prasad Paudel confirmed that existing tax structures on EVs will remain intact to promote the use of eco-friendly transportation.

The announcement follows growing concerns that the government might increase EV-related taxes, prompting a rush of imports and resulting in congestion at the Chobhar dry port.

In a further push for industrial and infrastructure development, the government has set a minimal 1% customs duty on both electric vehicle assembly industries and private sector imports of tunnel boring machines.