On May 30, Nepal’s government updated the custom duties on imported beverages. Previously, they charged Rs 2,000 per liter for distilled spirits. Additionally,Rs 200 was applied per liter for beer and Rs 300 per liter for wine.
The government modified the customs duty through the Finance Bill to be 100 percent of the import value for prepackaged spirits like whiskey, rum, brandy, gin, and vodka.
According to industry experts and importers, major imports of branded alcohol continue to be priced at around $4-5 up to an impressive $14-15 per liter. Online retail data supports these figures for specific labels.
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For instance, wholesalers purchase VAT 69 whiskey at a manufacturing cost of approximately $4.85 per liter. Likewise, importers pay roughly $10 as the FOB (Free on Board) price for Red Label whiskey, with Absolut vodka having a similar FOB value. Nonetheless, the ultimate retail price changes based on the delivery location and country.
Bottlers argue that imposing taxes on imported spirits based on their value makes less expensive international liquors even more budget-friendly, raising worries among local producers.
Producers caution that boosting imported alcoholic beverages into Nepal could adversely affect domestic businesses. Gaurav Sharda, who leads the Sharda Group, criticizes the administration for not carrying out sufficient investigation prior to modifying the tariff rates on alcohol products.
He cautions that the introduction of this new customs duty might cause the costs of wine and beer to increase twofold. Additionally, he contends that lowering the customs duty on spirits utilized in beverage manufacturing to 30 percent was erroneous.
He points out that the updated tariff system reduces custom duties for mid-range imported spirits like Red Label, VAT 69, and Absolut Vodka, but increases them for high-end brands.
Published by HT Digital Content Services with authorization from Republica.
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