my limited un¬derstanding, want to clarify something first. Please note that cars manufactured and imported from India need not pay Customs Duty, only Sales Tax. For example, In¬dian cars that are below 1500 cc will only attract 50% sales tax & 5% Green Tax. Keeping this in mind please read the following.
It is really sad that despite having high caliber civil ser¬vants, a research based work¬ing culture is still not insti¬tuted as a best practice within the service . This is mainly due to lack of dynamic and vi-sionary leadership in the gov-ernment which does not have the capacity to understand and visualize issues from a broader and more practical perspective.
Why I am saying this is with reference to revised taxes to be levied on vehicle and fuel import. I will give a 100 percent assurance that the rationale and purpose it is intended to fulfill will not be accomplished.
Why would I say this ? In India, foreign car manu¬facturers such as Nissan, Renault and etc have come into the Indian market and have started manufacturing cheaper cars such as SUV’s similar to Tucson, Santa Fe etc which suits the middle income earners in India and Asia.
Now here is the issue in the context of the revised ve¬hicle tax structure. To mini¬mize costs and penetrate into the middle class market cat¬egory, the “CC” of these new cars like SUV’s are lowered and mostly below 1500 cc.
This has opened up a whole new alternative for Bhutanese too. How so you would ask? It is for sure that we can no longer afford to buy high end cars like Tuc¬son, Santa Fe, Hiace Bus, Prado etc from third coun¬tries under the new vehicle tax regime which charges much higher tax rates.
However, similar types of cars are now available in India and that too below 1500 cc. Subsequently, Bhutanese people will definitely opt for such cars from India and pay only Sales Tax and not Customs Duty tax under the lowest cc category/bracket. I guess it is 55% tax including green tax.
This will lead to increase in Imports of vehicles from India which further leads to rupee outflow and more fuel import and demand. From a broader perspective, this will result in a high social impact and cost mainly due to the levy of green tax on fuel not serving its in-tended purpose.
Letter by Civic sense
This tax law will not be ap¬plied to each and every citi¬zens of this country. We see this even today as loads of people and organizations are being exempted. The principle of the law demands “equal ap¬plication without any excep¬tion”, that means, it applies to MPs, PM, Executives, Judicia¬ry and all the organizations. As this principle has been defaulted with it is time for people to form a Citizens Watch Organization, like in other countries, to de¬mand justice and fairness.
A government needs to think carefully before intro¬ducing any kind of taxes. We Bhutanese people don’t mind paying vehicle taxes if it helps the economy but the taxes this time are a bit too high mak¬ing many vehicles virtually unaffordable. Instead of tax¬ing small vehicles by 55 % I feel around 30 % should have been much better. I request the government to reconsider the taxes so that small people like myself can afford a car for my family.