Government Announces Relief and Concession Package for Flood Affected Businesses

7th September 2026, Kathmandu

The Government of Nepal, under a proposal by the Ministry of Finance approved by the Cabinet, has announced a comprehensive relief and concession package covering tax exemptions, customs relief, loan restructuring, and insurance claim processing for businesses and industrialists affected by recent severe flooding.

Government Announces Relief and Concession Package

Customs Duty and Tax Exemptions

Import Duty Waiver: Re-importation of swept-away or unrepairable commercial vehicles, transportation equipment, machinery, and industrial plants will be completely exempt from customs duties.

Duty Adjustment for Lost Goods: For goods destroyed in transit post-customs clearance, businesses may adjust equivalent duty amounts against fresh imports processed within six months.

Income Tax Exemption: Small taxpayers directly impacted by flood losses receive a full income tax exemption for the fiscal year 2025/26.

Return and Payment Extension: Deadlines for Value-Added Tax (VAT), income tax, and excise duty returns and payments due in Bhadra and Ashoj are extended to Kartik 25, 2083 BS (November 11, 2026).

Local Tax Relief: In coordination with provincial and local authorities, concessionary measures will extend to property taxes, business taxes, and building permit fees.

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Credit Facility and Interest Concessions

Loan Restructuring: Affected borrowers can access loan restructuring and rescheduling options, extending principal and interest payment timelines.

Cap on Interest Premium: Banking institutions will cap interest rates by adding a maximum premium of 0.5 percentage points above their base rate for up to one year.

Working Capital Support: Commercial banks will issue additional financing near base rates to support equipment replacement, vehicle acquisition, and operational continuity.

Expedited Insurance Claims and CSR Recognition

Advance Claim Payouts: Insurance providers must disburse up to 50 percent of estimated claim values in advance based on preliminary loss assessment reports.

Fast-Track Settlement: Accelerated surveyor appointment protocols and expedited claim settlement frameworks have been enacted to minimize payout delays.

CSR Tax Recognition: Legal provisions will be established allowing private and institutional contributions to the Prime Minister Disaster Relief Fund to count directly toward mandatory Corporate Social Responsibility (CSR) expenditure requirements.

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