Kathmandu: The Government of Nepal has officially increased the Capital Gains Tax (CGT) for both the stock market and the real estate sector through the new Economic Bill presented by Finance Minister Dr Swarnim Wagle.
Although the Minister characterized these levies as a “final tax” during his budget speech to simplify the tax filing process for investors, the actual rates have been adjusted upward to bolster national revenue collection. This move represents a strategic effort to generate more income from the country’s secondary markets and property transactions.
Under the revised tax structure for the equity market, short-term traders—defined as those who sell shares held for less than one year—will now be required to pay a 10 percent capital gains tax, up from the previous 7.5 percent. Similarly, the tax rate for long-term investors has been increased from 5 percent to 7.5 percent. By designating these as final withholding taxes, the government aims to provide a more definitive and less cumbersome tax environment for investors while simultaneously increasing the state’s share of profits from financial market activities.
Significant changes have also been introduced for the real estate sector to align with the broader fiscal policy. Individuals selling property will now be liable for a 7.5 percent capital gains tax on their profits, marking a notable increase from the previous rate of 5 percent. This adjustment reflects the government’s strategy to tap into the appreciation of property values and standardize tax rates across different asset classes, ensuring that the booming real estate market contributes more significantly to the national treasury.
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