The Finance Minister proposed introducing a uniform 10 % customs duty on all goods imported from third countries. The standard tariff rate according to the Finance Minister will create an open economy with diversified products, giving Bhutanese a comparative cost advantage. Lyonpo introduced the Customs (Amendment) Bill of Bhutan 2021 to the National Assembly, today.
The Customs duty is levied at the point of entry on the goods imported from third countries and the tariff rates ranges from 0-100%. Finance Minister says Bhutan currently have nine different types of Customs Duties.
“People have been paying tariff rates of 20 %, 30 % and 45 % but now we are going to standardise the tariff at 10 %. Whether it’s food or non-food products, we are proposing to impose only 10 % customs duty,” said finance minister Namgay Tshering.
However, the customs duty on alcohol, tobacco products and vehicles will remain as it is, including the more than 500 goods like medical equipment, agriculture and education-related products which enjoy customs duty exemption.
“In case of ICT related goods, most of them are exempted from Customs duty even today. And in the construction sectors, in order to encourage the involvement of youth, we need to mechanize construction works. So we have offered 0% tax on construction mechanisation hand tools,” Lyonpo added.
In the case of the goods imported from the South Asian Free Trade Area, the Customs Duty is levied based on the preferential tariff rates as agreed by the members.
The House asked the Economic and Finance Committee to review the Bill. The House will have the third reading of the Bill next week.
Samten Dolkar/Yeshi Dorji/Sangay Chezom
