Tax on cigarettes in Nepal lowest in South Asia

Tax on cigarettes in Nepal

Kathmandu, June 8

The tax on cigarettes in Nepal is the lowest in South Asia.

At a time when the government is putting a 13 per cent value-added tax (VAT) on daily essentials like potatoes and onions, it did not increase the tax on cigarettes significantly in the budget for the fiscal year 2023/24.

Compared to most countries in the world, taxes on tobacco and cigarettes are very low in Nepal. The government only increased the tax on cigarettes by 3 per cent.

The World Health Organization recommends a minimum 75 per cent tax share of the retail price of tobacco. In Nepal, however, the tax share is only 30.4 per cent.

On the contrary, the tax share on tobacco products in India is 54 per cent, Pakistan is 56 per cent, Sri Lanka is 66 per cent, Maldives is 68 per cent and Bangladesh is 71 per cent.

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