Although some members of the parliament opposed certain provisions of the Tenancy Bill, the parliament endorsed it with a majority vote today. Dagana MP Sonam Dorji did not agree with tenants paying a penalty of 24 percent of the house rent annually should a tenant not pay his rent in time.
When the bill was discussed in the previous parliament, the National Council recommended the limit to be raised from 15 percent to 24 percent. Wamrong MP Karma Tenzin said the limit was raised on the basis that housing loans have become expensive after a revision in interest rates.
Dagana MP Sonam Dorji said most of the houses are built by rich land owners, while the tenants are mostly from lower and middle-income groups, so raising the limit did not work in favour of the tenants.
He said there was no basis for keeping the limit at 24 percent. It would be fair; if the rate were equivalent to the interest rate a house owner has to pay to the bank.
Chummig-Ura MP Tshewang Jurmi said the objective of the bill was skewed. The objective of the bill, he said should be about the problems the tenants are facing today and what can be done to solve them but most provisions are in favour of the house owners.
NA Speaker Jigme Zangpo said it was not true and that it had equal provisions for both tenants and owners. For example a house owner will be liable for a penalty if security deposits are not paid in time to the tenants.
It also says that a house owner has to pay one month’s rent as a penalty to the government and two months’ rent as compensation to the tenants in cases of unlawful eviction by the house owners.
Outside the parliament, members said the Tenancy Act 2015 would have more teeth than the previous one, which was rarely followed.
For example, if a house owner increases the rent according to his own discretion, a tenant would have the right to complain to the Dispute Settlement Committee, which will be established under the Works and Human Settlement ministry.
House rents, according to the new Tenancy Act should be revised by 10 percent every two years.
The law however does not have any provisions on fixing house rents. Members said this was left to be decided by market forces.
