- GST will be implemented next year to modernize the country’s taxation system.
- Finance Minister Lekey Dorji introduced the GST Amendment Bill 2025 as a money Bill.
- The amendment aims to encourage private investment, minimize inflation, and boost exports.
- Short-term GDP distortions may occur, but medium-term gains are expected.
- GST Act of Bhutan was enacted in February 2020, but implementation was delayed due to system unreadiness and Covid-19.
- The GST Amendment seeks to simplify, make efficient, and neutralize the tax framework.
- GST will replace sales tax and excise duty with a uniform 7 percent tax rate.
- GST applies to both domestically manufactured and imported goods and services.
- Exports will be zero-rated, meaning no GST will be levied.
- Input tax credit is a major advantage of the GST system.
- The main change to the GST Act will be a reduction in exemptions.
- Current exemptions contradict GST principles and do not benefit consumers or manufacturers.
- Exemptions in services and goods will be reduced to improve efficiency and market neutrality.
Source: kuenselonline.com
Note that this post was (partially) written with the help of AI. It is always useful to review the original source material, and where needed to obtain (local) advice from a specialist.
