Bhutan Reduces SDF to USD 100 per night

The sustainable development fees for US dollar-paying tourist has been reduced. A discount of 50 per cent will be given for every dollar-paying tourist visiting Bhutan starting next month. The Ministry of Industry Commerce and Employment notified the changes last night through a news release. According to the ministry, the change has been made to meet the tourist arrival figures on the same volume as the pre-pandemic level by 2028.

The ministry stated that the reduction has been given in view of the important role of the tourism sector in boosting the country’s overall economic growth.

The ministry announced the changes with three major incentives.

A discount of 50 per cent for every adult US dollar paying tourist means a person shall only pay USD 100 per day.

Likewise, a 50 per cent discount will be applied to US dollar-paying children between 6 to 12 years as well. Children in this age range visiting as tourists can now pay USD 50 per day.

Meanwhile, with these changes in place, the 24-hour SDF waiver for tourists staying in border towns will continue.

Lyonpo Karma Dorji mentioned how the ministry tried other approaches before resorting to the new incentive.

“That was one reflection of how we listen to people and then look at the scenario and cases. And after that, in June, we introduced a new package, the 4×4, 7×7 and 12×18. Again, the intention is that it should cater to having more tourists so that tourists come here and then they stay for a longer duration.”

Moreover, a new incentive has been introduced to attain the pre-pandemic status.

“Earlier our experts while they drafted the Tourism Levy Act, their thinking was by 2025, it should be at the prepandemic level. But looking at the recent data, which was in the year about 95,000, we are short of that. Right now the record states 77,000. So, looking at all those data and the probability it is felt that four years is an optimal time frame.”

He added that changes with good intentions and for the larger benefits need to be embraced. 

“We do acknowledge that with these new SDF rules, it has just been about a year but in one year, I think we have learned a lot. So, it’s truly a reflection of the democratic process where we will listen and then adapt to change and improve on it.”

People working in the tourism sector and tourists hope that the new announcement would bring positive changes in the industry.

“They have already given, actually, they have already incentivised the package. But it looks like that is also not working. So I feel it’s at the right time. And impact is not going to be instant, because the season has already started. And most probably, we would know only from 2024. And it’s good for industry because it is almost dying. It looks like that. So hope it will give some respite in 2024,” said Garab Dorji, Chairperson of Guide Association of Bhutan.

“To be honest, due to high SDF last year, we were not able to pay off debt. Moreover, we were struggling with house rent and others. However, in the following season, with the government’s new initiative of USD 100. We are hopeful that it will hugely benefit us,” said Tashi Wangmo, a handicraft owner.

“I think more tourists will come here and it is beneficial for tourists like to stay longer here in the country. It is ultimately beneficial for the country,” said Sibyls Augliera, a tourist.

“The government’s new incentive of 50 per cent discount, I feel like it is going to greatly benefit all of us. With the increasing number of tourists and their stay, I am hopeful that we will benefit. Moreover, I am also hopeful that it will hugely benefit people working in tourism in the eastern dzongkhags as well,” said Sangay Thinley, a tour operator.

With the incentive coming into effect next month, the ministry says bookings done prior to the changes with the old incentives will not be affected.

The incentive will remain effective till the 31st of August 2027.

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