Hoteliers in Phuentsholing have renewed calls for an extension of the Sustainable Development Fee (SDF) waiver, arguing that the current 24-hour exemption has done little to stimulate tourism or revive local businesses in the border town. They are proposing a 72-hour waiver, which they believe would encourage visitors to stay longer and spend more, providing a much-needed boost to the local economy.
The proposal has found support within the National Assembly’s Economic and Finance Committee, which has acknowledged the economic challenges facing Phuentsholing and the urgency of revitalizing its tourism sector. Committee members noted that the town’s role as a gateway into the country has not translated into sustained economic benefits for local entrepreneurs.
Phuentsholing is often treated as a transit stop rather than a destination. Many visitors pass through briefly on their way to interior destinations, choosing not to stay overnight. As a result, hotels, restaurants, and other service providers report low occupancy rates and limited business, despite steady cross-border traffic.
Hoteliers argue that a longer SDF waiver would change visitor behavior. With a 72-hour window, tourists would have the flexibility to explore the town, sample local cuisine, and engage in shopping and leisure activities. They also believe the extended stay could serve as an incentive for travelers to continue onward to destinations such as Thimphu, Paro, and Punakha, spreading economic benefits more widely.
Another motivation behind the proposal is competition from Jaigaon, the neighboring Indian town just across the border. Business owners say that many visitors currently choose to stay there to avoid fees, resulting in lost revenue on the Bhutanese side. A longer waiver, they contend, could help level the playing field and draw visitors back into Phuentsholing.
However, the idea has also raised concerns. Some policymakers have warned that extending the waiver could lead to misuse if visitors exploit the system without contributing meaningfully to the local economy. To address this, stakeholders have suggested strengthening digital verification and monitoring mechanisms to ensure compliance and prevent abuse.
The government has yet to make a final decision on the proposed extension. The ruling party has previously pledged to review tourism policies as part of broader efforts to restore revenue streams and generate employment. For now, hoteliers in Phuentsholing remain hopeful that a revised SDF policy will help transform the border town from a mere transit point into a destination in its own right.
