The National Assembly yesterday adopted the motion for a policy to substitute import of Liquefied Petroleum Gas (LPG) by promoting the use of electric energy and electrical appliances by waiving off the existing 20 per cent customs duty and five per cent sales tax on spare parts of such appliances.
The Bardo_Trong MP Gyambo Tshering moved the motion in the House. He said the import of LPG would keep on increasing if alternatives were not found.
However, the Foreign Minister Dr Tandi Dorji said, “regarding the customs duty and sales tax, I feel that exemption of the tax should be carried out properly during the revision of tax and not on an ad-hoc basis.”
“If sales taxes on spare parts are imposed, it’s no use waiving off custom duty of 20 per cent. Our ministry has already submitted our proposals and recommendations to the finance ministry and they will present it during the next session,” Economic Affairs Minister Loknath Sharma said.
He added that the main cause of LPG shortage in the country is people’s choice for subsidised LPG, shortage of LPG in the market and inefficient distribution system.
Some MPs also pointed out the basic public services delivery has remained the same since 2012, whereas the number of households has increased by about 30 per cent from 2013 to 2018 thereby increasing the demand for LPG drastically.
MPs submitted that all the initiatives and the efforts to solve the issues till now have not worked well and will not work if the root cause of LPG shortage is not addressed.
The House passed the motion for adoption of a policy to substitute LPG import by promoting the use of clean electric energy and electrical home appliances like oven with a waiver of existing 20% Custom duty and 5% sales tax on spare parts with 34 Yes votes, 5 No votes and 3 abstaining out of 42 Members present.
The House also adopted the second motion regarding the improvement and enhancement of the availability of subsidised rural electricity.
At present, Bhutan imports Bhutan import 1,700 MT of LPG including 1,000 MT of Non-subsidised LPG every month.
