Nepal has passed progressive new policies making it possible for tech entrepreneurs worldwide to start an IT startup for as little as रु. 100 (less than $1).
The new budget announced by Finance Minister Janardan Sharma allows companies to be formed with a minimum authorized capital of just रु. 100 (less than $1) and no registration fees. There are also no minimum thresholds for foreign investment in IT startups.
The policies are designed to attract IT startups and encourage the growth of Nepal’s tech sector.
Once established, IT startups operating in Nepal can enjoy substantial tax incentives, including:
• A 50% tax holiday for up to 5 years if the company is export oriented
• An effective corporate tax rate of only 1% for the current fiscal year
The ultra-low cost of company formation, coupled with tax holidays and Nepal’s affordable labor costs, are drawing the attention of tech entrepreneurs around the world who want to launch a startup at the lowest possible expense.
“Nepal has made it very easy for us to realize our dream of founding a tech startup,” said Pavel Sarwar, a tech entrepreneur from Bangladesh currently living in Malaysia planning to launch an IT company in Nepal. “The cost to get started is nearly zero and the tax incentives are fantastic. It’s a very inviting policy for founders on a shoestring budget.”
Experts say Nepal’s pro-business policies targeting the IT sector could put the country on the map as a launchpad for global tech startups, leveraging its strategic location, young workforce and government support.
“Nepal is sending a clear message that it wants to attract tech companies and the innovative entrepreneurs that create them,” said Sarabin Turin, Forber 30 Under 30 Asia 2023 and Founder at Turtle Venture. “Their policies demonstrate they understand what startup foundersneed – low friction and affordable operating costs – to get their ventures off the ground.”