English | Dzongkha Friday, June 18, 2021

Landowners in Bumthang town request the government to revisit the municipal taxation policy

Jun 10, 2021

Landowners in Bumthang town are requesting the government to revisit the municipal taxation policy and also defer its implementation until all town infrastructure is provided. The matter was discussed in the last two Dzongkhag Tsogdu sessions after the Dzongkhag Administration proposed the implementation of the new municipal taxes. More recently, the matter was also raised at the National Assembly.

If the new taxation comes into effect, landowners in Bumthang town will have to pay more than Nu 8,700 per acre of residential land. Likewise, for commercial areas, the rate is more than Nu 17,000 per acre.

So far, people have been paying rural land taxes of only Nu 12 an acre.

Meanwhile, Bumthang’s new town is still under development. Primary road widening works are underway but there are no proper access roads within the plots. Moreover, a sewerage system is yet to be developed and street light coverage is only in few areas.

“Since last year when the Dzongkhag Administration started talking about implementing the new taxation, we have been worried. As the town is still under development, only the main roads are widened, the individual plots are only demarcated and nothing much has been done. We are not even able to cultivate in our plots like in the past,” said Tekpa, a resident of Bumthang town.

“Some people say a new town being developed always benefit the people but as of now, nothing much has happened. We still work on our farms for our livelihood. We might as well have to sell our land to pay taxes. Farmers like us can’t afford to pay such heavy taxes,” added Kuenzang Dema, another resident.

“Due to land pooling works, our cowsheds have been dismantled and trees uprooted. There is no proper town here right now and roads are not properly built. If the authorities levy taxes just because our area is named as a town, barely anyone would be able to pay them,” said Dorji, another resident.

The Dzongkhag Tsogdu wrote to the National Assembly last year after the local leaders raised the issue. The implementation of the new taxation was halted. Last Friday, Chhoekhor-Tang’s Member of Parliament, Dawa questioned the Finance Minister regarding the issue at the National Assembly.

“Right now the only commercial area is the old Chamkhar town. With the new town planning works, all the villages nearby have also been integrated into the town. With this, people have now even become ineligible for subsidised rural timber provision. It would be befitting if the new taxes are imposed only after all the services and facilities are provided and the new taxation deferred. Rural taxation should be considered for them for the time being” he said.

To this, the Finance Minister said the issue arose after the Local Government Act was enacted in 2009 and district towns were identified as Class B Throms. Residents in Class B Throms then became ineligible for rural taxation.

“To resolve such issues, the Finance Ministry is going to propose value-based taxation. With this policy, taxes will be as per the prices of land. An area with all the town amenities and services will have a higher land price and those without will be cheaper. The Finance Ministry has finished all the groundworks for the new taxation system,” said the finance minister.

Lyonpo also added that the ministry has plans to present the new taxation policy in the National Assembly during the winter session, this year.

Meanwhile, like in Bumthang, similar issues regarding municipal taxation are also existent in most Dzongkhag Throms across the country.

Kipchu, Bumthang

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