Nepal Brings Ride-Hailing Into the VAT Net With a 5% Platform-Collected Levy

Summary

• Effective Shrawan 1 (17 July 2026), Nepal’s Inland Revenue Department imposes 5% VAT on transport and delivery services provided through ride-sharing apps (Pathao, inDrive, Yango), under amendments in the Economic/Finance Act 2083. [vatupdate.com], [english.ne…lviews.com]
• Platforms must collect the 5% from drivers at each transaction, issue tax invoices on their behalf, and remit by the 25th day of the following month; the collected tax is not platform income and carries no input-tax credit. [1stopvat.com], [globalvatc…liance.com]
• Platforms continue charging the standard 13% VAT on their own commissions/booking fees; drivers must obtain a PAN but need not register separately for VAT if the platform is compliant. [english.ne…lviews.com], [1stopvat.com]

Article

Nepal has introduced a mandatory VAT framework for ride-sharing digital platforms. Through a public notice issued by the Inland Revenue Department (dated 15/17 July 2026) and amendments under the Economic Act 2083, transport and delivery services supplied via apps such as Pathao, inDrive and Yango attract 5% VAT from Shrawan 1 (17 July 2026). Platform operators must collect the 5% from riders (drivers) at the time of each transaction, issue tax invoices on their behalf together with driver ID details, and deposit the collected tax with the revenue office by the 25th day of the month following the reporting period. This collected VAT is not treated as the platform’s own income and confers no input-tax deduction. Separately, platforms must continue to charge the standard 13% VAT on commissions and other booking fees. Every affiliated driver must obtain a Permanent Account Number (PAN), though individuals supplying services solely through a compliant platform are not required to register separately for VAT.

Sources

• VATupdate.com
• 1stopVAT
• Global VAT 

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