Government of Nepal, Ministry of Finance has released the budget for the Fiscal Year 2083/84 (FY 2026/27) today. Finance Minister Dr. Swarnim Wagle presented a long budget speech of about 2 hours under the newly elected majority Balen Government just two months ago. The expectations were high from Dr. Wagle given his strong resume having economics and public policy degrees from globally reputed universities like LSE, Harvard and ANU followed by his works at UNDP.

The budget looks like a popular budget specially targeting the middle-income earners and government employees. This followed by several other tax and excise duty cuts aimed at reducing the cost of production. High earners will also see a good boost to their pocket with the highest marginal tax rate cut down from 39% to 29% followed by the finalization of CGT rate (which was controversial since a while) for share investors . For personal income taxes, the budget has astonishingly doubled the lowest income threshold from 500,000 to 1000,000 significantly decreasing the tax burden for the middle income earners. Also, the government employees are set to see a pay rise of 21% from the upcoming fiscal year which starts just one and half months from now.

The budget paper has assumed a government revenue growth of around 22% for the upcoming fiscal year. This looks too ambitious given the updated projection shows that government revenues were on track to grow by about 9% during the current FY.

Sources:
https://mof.gov.np/
https://mof.gov.np/content/1741/budget8384/