Bhutan Plans to Incentivise Tourism Industry

The Bhutan government is exploring ways to incentivize tourists to visit the country and extend their stay. During a recent meeting with representatives from various sectors, Prime Minister Dr. Lotay Tshering proposed offering promotional discounts on the sustainable development fee (SDF) for visitors who stay longer than their initial booking. He also suggested waiving the SDF for tourists under the age of 18, in line with Bhutan’s positioning as a family destination.

The Prime Minister also suggested waiving the SDF for expatriate workers coming to Bhutan, an idea proposed by the tourism industry. Currently, immigration laws create significant obstacles to bringing foreign experts to Bhutan to help train local staff.

While the Tourism Levy Act 2022 prohibits the government from waiving the SDF of USD 200 per night for tourists, the Department of Tourism can offer exemptions or concessionary levy rates. According to Section 9 of the Act, the competent authority may provide for an exemption or concessionary levy rate on the applicable SDF, subject to any conditions prescribed in the rules.

The government plans to offer the proposed incentives until December 31, 2024, including a possible waiver of the SDF for the first five days of a tourist’s stay. For longer stays, the government is considering a triple seven policy that would require payment of the SDF for the first seven days and 50% of the SDF for the second seven days, with no SDF for the subsequent seven days.

The Prime Minister’s monthly meeting with the private sector serves as a forum for discussing challenges facing the tourism industry, including the need for improved payment gateways for visitors and the promotion of local products.

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