Government Announces 10-Year Income Tax Exemption for New Cinema Halls Outside Major Cities

Kathmandu — In what the exhibition industry has called a long-overdue step, the government of Prime Minister Balen Shah has announced a 10-year full income tax exemption for new cinema halls established outside metropolitan and sub-metropolitan areas. Finance Minister Dr. Swarneem Wangle made the announcement while presenting the federal budget for fiscal year 2083/084 in Parliament on Friday.

"I have made arrangements to provide complete income tax exemption for the first 10 years to those who establish new cinema halls in areas outside metropolitan and sub-metropolitan municipalities," the Minister said.

The announcement has been warmly welcomed by cinema hall operators, who have long been advocating for this exact concession to encourage investment in cinema infrastructure beyond major urban centers. New halls outside Kathmandu, Pokhara, and other large cities have historically struggled with financial viability, and the tax relief is seen as a meaningful incentive to expand Nepal's exhibition network.

However, the film industry's broader response to the budget has been mixed. Beyond the tax exemption for new rural and semi-urban halls, the budget fails to address several other pressing needs of Nepal's film sector: developing film studios, providing targeted promotion and support for Nepali cinema, or creating any production-side incentives. Filmmakers and industry professionals have expressed disappointment that the sector continues to be treated as an afterthought in national economic planning, with only one provision included despite the industry's longstanding list of needs.