The National Assembly Yesterday saw intense deliberation on the proposed 10% tax on interest earned from fixed deposits and dividends under the Income Tax (Amendment) Bill 2025. The debate grew so intense that the speaker decided to pause the session, allowing more time for members to deliberate further today.
The Economic and Finance Committee recommended exempting tax on interest income from fixed deposits up to Nu 500,000 and dividends up to Nu 100,000.
However, the finance minister recommended that the exemption amount should be the same.
Not all members supported the recommendations. In fact, some members, especially those from the Opposition Party, were against taxing the interest amount.
Bomdeling-Jamkhar MP Wangdi voiced concern for rural citizens, saying, “There are people who placed their savings in fixed deposits after selling their land years ago, thinking they can’t do manual labour anymore.”
Opposition Leader Pema Chewang also opposed the measure, pointing out the contradiction in government policy. “This is the very government that waived off fixed deposit interest during their tenure to encourage a saving culture. I wonder why you want to reintroduce it now. Now we have heard reports of people withdrawing their fixed deposits. The government says we do not have money. But the income we were supposed to make from the Pedestrian Terminal in Phuentshogling was removed. It is not fair to collect it from our people. I would rather request the government to keep as it is. Many of our former civil servants rely on the interest from fixed deposits for their livelihood.”
Kengkhar-Weringla MP Dorji Wangmo also expressed disapproval. “I don’t support either the committee’s or the government’s proposal. When I ask people about their pension plans, many say they prefer saving in fixed deposits because they aren’t sure if their children will support them. Currently, 91 percent of our population isn’t covered under any pension scheme.”
The house will debate to review the bill today as well.
Samten Dolkar
Edited by Tandin Phuntsho
