After years of deferral, the Ministry of Finance is gearing up for the rollout of the Goods and Services Tax, set for January next year. To ensure a smooth and effective rollout, the finance minister at the Meet the Press session today said that a soft launch will take place on November 11 this year, giving the system its first real test before the full implementation.
During the summer session of the Parliament this year, the Goods and Services Tax rate was reduced from the initially pitched seven per cent to five per cent.
The GST was introduced as a reform to modernise and simplify Bhutan’s tax system, aiming to create a more streamlined process for businesses and consumers, while also aligning Bhutan with global best practices in taxation.
With the commencement of the GST scheduled next year, the finance minister said preparations are ongoing to ensure full system readiness.
“We are working on system readiness, which includes computers, hardware, networking, and software. It cannot be done here alone; there needs to be a strong intranet. Now, the intranet of the eight regional offices of the Department of Revenue and Customs should be strong across the country. Moreover, security should be strengthened. We are working with GovTech on this,” said Lekey Dorji, Finance Minister.
Likewise, the Department of Revenue and Customs or DRC is working on tax functionalities which include registration, return filing, payment, refund, appeal and objections and other compliance required under GST for the seamless transition.
Meanwhile, additional manpower on contracts has been initiated to support the implementation process. Capacity-building efforts are also being extended to regional revenue and customs officials to ensure institutional readiness.
The ministry has completed draft GST Rules and Regulations and is being reviewed further to ensure clarity.
“GST Rules and Regulations have been drafted by the DRC. And the ministry’s Policy and Planning Committee will review and endorse it in September,” added the finance minister.
He added that a media advocacy and communication strategy has been developed to sensitise taxpayers, businesses, and the public on the key features of GST and the Bhutan Integrated Taxation System.
So far, DRC has notified over 2,200 taxpayers identified for compulsory GST registration with an annual business turnover of Nu 5 M.
Kinzang Lhadon
Edited by Sonam Pem
