SDF of USD 16.25 for regional tourists to generate Nu 750 mn in 1st year

Most citizens welcomed the move but HRAB is not pleased

The Draft Tourism Policy for Regional Tourists by the Tourism Council of Bhutan (TCB) had indicated that regional tourists from India, Bangladesh and the Maldives, visiting Bhutan will be imposed a Sustainable Development Fee (SDF).

The Finance Minister, Namgay Tshering, while introducing Tourism Levy Exemption (Amendment) Bill of Bhutan 2020 during the 24th Session of National Assembly proposed USD 16.25 or 25 percent of USD 65 per day for regional tourists. International tourists are levied SDF of USD 65 per day.

This comes to around Nu 1,138 if one dollar is taken at Nu 70.

Regional tourists from India, Bangladesh and the Maldives don’t have to go via the USD 250 tour package and do not require a visa, unlike others.

Tourism Levy Exemption Bill of Bhutan 2020 was introduced to amend the Tourism Levy Exemption (Amendment) Act of Bhutan 2018. The new section states that a regional leisure tourist shall be liable to pay the tourism levy per night halt.

Lyonpo Namgay Tshering said that according to the current tourism policy, only International tourists are levied daily SDF of USD 65, and in order to make Bhutan exotic or preferred destination, a daily SDF of USD 16.25 is proposed for regional tourists as well.

The Member of Parliament from Panbang, Dorji Wangdi, raised an issue of inconveniences faced by regional tourists visiting Bhutan waiting for long hours at entry point and processing of documents. He asked that with the imposition of daily SDF for regional tourists, is the government looking into rules and regulation that would ease such inconveniences.

Most people, including those on social media welcomed the levying of SDF for regional tourists as a good initiative by the government in managing and regulating regional tourism and also the impacts of mass tourism. There was also a sizeable number who said the levy is too less and asked for a higher amount.

A smaller number questioned whether visitors will get any benefit from the SDF imposed on them and that if it can hamper the tourism business in Bhutan.

The Chairman of the Hotel and Restaurant Association of Bhutan, Sonam Wangchuk, said that though the association supports the government’s proposal of having regulation for mass or regional tourism, the association is concerned about the amount of SDF to be imposed on regional tourists.

Sonam, said that USD 16.25 for regional tourists is too high and this would impact the arrival of tourists in the country.

Giving an example of a family, he said that if a family of three visits Bhutan, they have to pay daily SDF of Nu 3,700. Assuming that they will stay for a maximum of 5 days, they will have to pay Nu 23,000 per trip that is excluding one-time E-permit processing fees of Nu 300 to 350 and mandatory guide fees of Nu 1,000 per day. They will also have to pay for accommodation, meal and transport separately.

“Most of them can’t afford it,” he claimed.

He said, “With the SDF, government is planning to waive off the monument fees, but I feel that they have to keep the monument fees as this will also curb the large numbers from entering our sacred places. They have already revised the monument fees in January, and with SDF if they want to waive off the monument fees. I feel that government to trying to do many things at one time which is not good.”

He said SDF should be imposed, and HRAB supports the government’s proposal, however, it must be done cautiously. “We are going to impose fees to regional tourists for the first time, we should do it cautiously or step by step. We suggested to the government that Nu 500 per person per trip, but Nu 1,100 to 1,200 per person per day is too expensive for them,” he said.

‘We feel that the government of the day is doing something very confidently which the past government has not been able to do, and we are in appreciation for the current government but the amount of SDF that is going to be imposed needs to be carefully decided,” he added.

He further said many people have invested huge amount of money in the hotels, and therefore, are worried with the change in policy.

While the HRAB Chairman felt the fee was too high many Indians also came on social media to say the fee is affordable. The perception among them was that they would have to go through the USD 250 per day package.

Subash Chandra Das, 49, from Kolkata an Indian tour operator who brought 59 Indian tourists with him to Bhutan towards the end of December 2019 said that if the fee is around Nu 1,000 a day then it would be affordable for Indian tourists who would come.

He said that the fear among the tourists was that they would have to pay USD 250 a day like other tourists.

The Association of Bhutanese Tour Operators (ABTO) said that the proposed SDF for the regional tourists is more or less in line with what the association has suggested or recommended to the government. In terms of managing regional tourists, SDF is just one component of overall management strategies and ABTO has yet to see the other aspects of management to make it fruitful, said ABTO.

The Environment and Climate Change Committee will review and present it to the House for deliberation and debate on 3 February.

The Finance Minister said that hotels must have been apprehensive due to the rumors that the SDF would be up to USD 65 for regional tourists. He said that the 25 percent of the USD 65 is a reasonable amount and so the hotel industry should not worry. Lyonpo reasoned that most regional tourists do not stay beyond a week and so the cumulative impact is not as much.

He also said that the nation is above everything and it is important to preserve the high value and low volume tourism policy.

Though the main aim of the policy is not to generate revenue the SDF on regional tourist is expected to generate Nu 750 mn in its first year of implementation taking into account a 20 percent fall in the number of regional tourists.

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