Excise in Nepal — Goods, Rates, Licensing and Renewal

Excise is governed by the Excise Act, Rules, current schedules and annual amendments. Determine whether the activity is manufacture, import, storage, distribution or sale and whether the goods or services are covered. A VAT registration or ordinary business licence does not automatically satisfy excise licensing.

Rates can be quantity-based, value-based or governed by a particular product description and note. Use the current schedule, classification, units and conditions. Alcohol strength, product composition, packaging and tariff description can affect the applicable line; a generic sector rate is unsafe.

A renewal application is not itself a renewal decision. Track conditions and expiry before continuing activity. A change of premises may need a new approval even if the business name is unchanged.

Identify the goods, HS/product line, unit, taxable event, base, rate and current note. Distinguish domestic production from import where the schedule does so. Keep a dated copy or official link to the exact entry behind the calculation.

For illustration, assume a verified quantity-based excise rate of NPR 50 per litre and taxable quantity 1,000 litres. Excise is NPR 50,000. This assumed rate demonstrates arithmetic only; it is not a Nepal alcohol or beverage rate. An ad valorem schedule needs its own statutory value base and cannot be computed by substituting litre quantity.

A restaurant proposes selling liquor. It checks the licence for that activity, premises and period and obtains stock from lawful sources with required evidence. A food-service registration does not establish liquor-sale authority. If it also manufactures a product, that activity needs a separate excise and sector analysis.

Keep the application, licence, renewal, fees, conditions and correspondence together. Use current Finance Act amendments when checking product-specific rates, and confirm the current licensing forms and fees.

Give each controlled product a record showing commercial name, tariff classification, composition, strength where relevant, packaging, unit of measure and applicable schedule line. Record whether tax was paid at import, manufacture or another prescribed stage. An invoice description such as “beverage” is too broad to determine a liquor or tobacco rate. Distinguish products even when the supplier uses one stock code for several pack sizes. Assume a hypothetical quantity-based duty of NPR 100 per prescribed unit and 500 relevant units. The arithmetic is NPR 50,000. If the actual schedule instead uses a litre, pure-alcohol measure, retail-value basis or a different product category, that calculation is wrong despite correct multiplication. The example explains the need for classification; NPR 100 is an assumed rate and is not published as an excise rate for any Nepal product.

Maintain the licence number, holder, approved premises, activity, conditions and recorded renewal period. Calendar the deadline stated in the applicable official document and retain fee and acceptance evidence. A payment receipt without an accepted renewal does not demonstrate that every licensing condition has been met. If the business adds a location, changes ownership or expands from retail to production, identify the amendment or new approval required before operating. A supplier’s licence is not the buyer’s licence. A retailer should retain lawful sourcing records while separately confirming its own permitted activity. When stock remains after closure or a change of licence, document the authorised treatment instead of selling it informally. Physical stock, purchasing authority and tax evidence should remain connected until the last controlled goods leave the premises.

Finance Act 2083 replaces or amends the current excise schedule. This guide covers licensing and classification; select product-specific rates from the applicable annual schedule. A product-specific publication should name the precise schedule item and period. Keep the signed classification and rate working with the business records so that next year’s rate change does not alter an earlier transaction retrospectively.