- Bhutan replaced its complex Sales Tax system with a 5% Goods and Services Tax (GST) on almost all goods and services starting January 1, 2026.
- GST introduces input tax credits and requires mandatory registration for businesses with annual turnover above BTN 5 million.
- The reform aims to broaden the tax base, increase government revenue, and modernize the tax system, but may temporarily raise indirect taxes for households and increase short-term poverty.
- The previous sales tax regime was fragmented, inefficient, and targeted mainly luxury and non-essential goods, with multiple rates and many exemptions.
Source: vatabout.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.
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