Kathmandu: Nepal’s Cabinet has approved a series of revised tax rates that will come into effect from midnight Friday, following the endorsement of the national budget for fiscal year 2026/27.
The decision was made during a Cabinet meeting chaired by Prime Minister Balen Shah after a proposal from the Finance Ministry.
Some of the revised tax rates approved earlier in the day are set to be enforced immediately from midnight under Nepal’s temporary tax collection framework.
The Cabinet also formally approved the national budget before Finance Minister Swarnim Wagle presents it before a joint session of the federal parliament later in the afternoon.
The revised tax measures are being implemented through what is known in Nepal as a “notified order,” a legal mechanism authorized under the Temporary Tax Collection Act of 1955.
Under the law, the government can issue notified orders to impose, increase, reduce, or alter taxes before the related financial bill is fully passed by Parliament. The provision is commonly used to immediately enforce changes in customs duties, excise taxes, and other fiscal measures announced in the annual budget.
According to the Act, such notified orders remain valid for up to six months unless the provisions are either formally enacted into law through the financial bill or repealed earlier.
The Cabinet can also specify the exact implementation date while issuing the notified order. Following this practice, tax rate changes announced in the budget traditionally take effect from midnight on the day of the budget speech itself.
However, officials note that the notified order only covers specific tax rate revisions and does not automatically enforce all provisions included in the financial bill. Other broader policy measures will only take effect once the financial legislation is passed by Parliament and becomes law.
Comment Here