The National Assembly today approved the Economic and Finance Committee’s suggestion to increase the sales tax on the import of cement. According to the Committee, the country today not only produces enough cement for itself but is also actively exporting it to other countries. The House decided to increase the sales tax to 30 % from the proposed sales tax of 15 %.
Continuing the third reading of the Tax Bill of Bhutan 2022 at the National Assembly today, the Economic and Finance Committee proposed increasing the sales tax on the import of cement from 15 % to 30 %.
“Today, we can produce enough cement for ourselves. Besides we are in a state whereby we are exporting about 60 to 70 % of cement to other countries. It will only benefit us no matter how much we increase the sales tax,” said Kinga Penjor, the Chairperson of the Economic and Finance Committee.
However, a few members questioned the reliable supply of cement given the fact that many infrastructure developmental activities are taking place in the country.
“We ran short of cement last year. We could not get cement from Nganglam as they had difficulties in getting the required raw materials for cement production. Likewise, we could not get cement from Gomtu as well because they were undergoing renovation. This will affect the progress of major development works in the country,” said MP Ugyen Wangdi, of the Dramedtse-Ngatshang constituency.
“There is every chance that we might run short of cement in the future if the cement producers cannot assure a reliable supply of cement. Likewise, the quality of cement should also be kept in mind,” added MP Ugyen Tshering, of the Lamgong-Wangchang constituency.
In response, the chairperson of the Economic and Finance Committee clarified, despite levying a 30 % sales tax, a bag of imported cement would only cost about Nu 401. He added, a bag of local cement today costs about Nu 485 in the country:
“Whether our cement producers are unable to produce enough cement locally, people can still import cement from outside. We are not banning the import. People can import from outside and that too at a similar price of Bhutanese cement.”
The House at the end of the deliberations approved the committee’s recommendation with 23 out of 44 members showing support through raise of hands. Likewise, the committee also suggested increasing sales tax on hume pipes, bricks, wire meshes, heavy machine rides, and plastic, wood, and metal furniture but the house majority decided to stick to the government’s proposed rates. The Tax Bill of Bhutan will be tabled for adoption at the National Assembly tomorrow.
Passang Dorji
