20 July 2026

Safer Nepal Coalition Welcomes Calls to Reconsider Electricity Tax in the National Budget 2025/2026

Safer Nepal Coalition expresses its serious concern regarding the electricity 5% tax introduced in Nepal's National Budget 2025/2026. At a time when Nepal is pursuing sustainable development and the global community is working to reduce dependence on fossil fuels to address climate change, policies that discourage the use of electricity are counterproductive.

The Coalition is encouraged by the recent interview of former Finance Minister Surendra Pandey, in which he highlighted the need to reconsider the taxation of electricity as part of Nepal's efforts to reduce dependence on fossil fuels and address the growing energy and environmental challenges. His remarks reinforce the importance of adopting policies that support clean energy and sustainable development.

Electricity is a cleaner and more sustainable source of energy. Imposing additional taxes on electricity increases the cost of using electric-powered technologies and everyday products, including electric vehicles (EVs), electric heaters, electric cooking appliances, electric equipment, and other energy-efficient technologies. Such measures may discourage households, businesses, and industries from adopting cleaner alternatives.

Instead, the electricity tax could encourage continued reliance on petrol, diesel, LPG, and other fossil fuels, increasing greenhouse gas emissions, air pollution, and Nepal's dependence on imported energy. This would undermine the country's significant investment in clean hydropower and its commitment to climate action.

Safer Nepal urges the Government of Nepal to review and reconsider the electricity tax and adopt policies that encourage the use of electricity and other clean energy sources. Promoting electrification is essential for reducing carbon emissions, improving public health, strengthening energy security, and supporting Nepal's long-term sustainable development goals.

Safer Nepal Coalition remains committed to advocating for evidence-based policies that protect the environment, promote sustainable transport and clean energy, and contribute to a safer, healthier, and more prosperous Nepal.

The Safer Nepal Coalition is a collaborative initiative that brings together organizations with complementary expertise in policy advocacy, peacebuilding, community engagement, and social inclusion.

Safer Nepal Coalition

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