Royalty waiver, a boon for tour operators

l Kinzang Namgay, Thimphu

 

Despite the opposition party’s surge to hold waiver of applicable tourism levy or sustainable development fee (SDF) of USD 65 per tourists per night, the House resolved to do away with the royalty on those tourists visiting the eastern circuit.

The opposition party, while discussing on adoption of Tourism Levy Exemption Bill (TLEB), said that they welcome idea to promote eastern Bhutan but waiver of the SDF is undermining the tourism policy of ‘high value, low impact’.

The Panbang Member of Parliament (MP), Dorji Wangdi, who repeatedly voiced out against the decision during the session in the House said that the government is derailing His Majesty The Fourth King’s noble vision.

“I am in favour of waiving off the SDF but I do not support the royalty waiver in six Dzongkhags. Why only in six dzongkhags? Even the southern and central dzongkhags should reap equal benefits,” said Dorji Wangdi.

Nubi-Tangsibi MP, Nidup Gyeltshen, said that the government should have explored other avenues to promote tourism in the region. “Is waiving off royalty the only option?” he asked.

The chairman of the finance committee, Khaling-Lumang MP Karma Tenzin, said that it is on the recommendation from Tourism Council of Bhutan (TCB) that they have included only six eastern dzongkhags.

The opposition leader, Dr (PhD) Pema Gyamtso, suggested the House to slash the royalty by half. “Instead of waiving off the SDF completely, how about reducing only USD 30 and use the remaining income to institute tourism development fund in the east?” he asked.

However, the recommendations that the opposition party forwarded failed to get enough support from the members in the House.

Discussing about the duration of royalty waiver, the committee proposed for five years but the finance ministry suggested for three years. After much deliberation, the members agreed to keep it till the end of 2020.

The confusion engulfed in the House on whether this waiver should construe as a Bill or as an Act.

According to the Prime Minister, Dasho Tshering Tobgay, the Bill is being proposed as a Money Bill and it shall take effect from the date on which it was first tabled in the House.

MP Ugyen Wangdi of Dremetse-Ngatshang said that even the Fiscal Incentive Act was proposed as a Bill but became an Act after going through full circle of legislation.

As per TLEB, the ‘eastern circuit’ includes Lhuentse, Monggar, Pemagatshel, Trashigang, Trashiyanstse, and Samdrup Jongkhar. And tourists visiting these dzongkhags will get the benefit.

The Bill states that TCB shall be the concern authority to verify and ensure proper compliance as per the Act. It shall review and recommend the revision of levy as per the law and also submit timely report to the ministry of finance.

Meanwhile, the tour operators welcomed the initiative to waive off the royalty.

“When we talk about royalty waiver, we have to understand that the government is not going to lose any revenue because hardly 2 percent of the total tourists visit the eastern region. And if the concern is about this 2 percent, that will be compensated by the tour operators in the east in the form of business income tax and other related levies,” said a tour operator, Thinley.

He mentioned that hoteliers and travel agents in the east will be immensely benefited by this move.

“This will also enhance economic growth and provide job opportunities for the youth in eastern part of Bhutan,” he said.

 

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