…𝑺𝒊𝒏𝒄𝒆 𝒕𝒉𝒆 𝒐𝒑𝒆𝒏𝒊𝒏𝒈 𝒐𝒇 𝒕𝒐𝒖𝒓𝒊𝒔𝒎 𝒊𝒏 𝑺𝒆𝒑𝒕𝒆𝒎𝒃𝒆𝒓 2022, 𝒕𝒉𝒆 𝒊𝒏𝒅𝒖𝒔𝒕𝒓𝒚 𝒉𝒂𝒔 𝒈𝒆𝒏𝒆𝒓𝒂𝒕𝒆𝒅 𝒂 𝒓𝒆𝒗𝒆𝒏𝒖𝒆 𝒐𝒇 𝒂𝒑𝒑𝒓𝒐𝒙𝒊𝒎𝒂𝒕𝒆𝒍𝒚 𝑼𝑺𝑫 7.06𝑴 𝒂𝒏𝒅 𝑵𝒖 46.68𝑴 (𝒂𝒓𝒐𝒖𝒏𝒅 𝑼𝑺𝑫 570,000) 𝒇𝒓𝒐𝒎 𝒕𝒉𝒆 𝑺𝑫𝑭
Despite the drop in visitor numbers, 16,520 people have visited the country since it reopened in September 2022, which is better than what the tourism sector forecasted.
According to records from the Department of Immigration, of the total arrivals, 8,273 were Indian tourists who paid the Sustainable Development Fee (SDF) of Nu 1200 so far this year.
Similarly, around 3,431 tourists visited the country paying USD 200, and about 4,816 tourists visited paying the old SDF of USD 65 per night.
“The Tourism Levy Bill was founded on the principle of high value, low volume tourism and specifically relates to the revision of the SDF but is also part of the overall government transformation,” said Carissa, Chief Marketing Officer, Department of Tourism (DoT).
Despite the new SDF levy of USD 200 per person per night for visitors from all other countries except India, who must pay Ngultrum 1200 per person per day, visitors have continued to visit Bhutan, though the numbers are lower than before the pandemic.
Meanwhile, some of the tour operators said that if a tourist comes alone or in a pair, it is very difficult for them to manage resources for them. However, if tourists come in a group, they make minimal profit from it.
A few foreigners have said that the revised SDF has not stopped their dream of visiting Bhutan. “I actually feel okay with it. I think I am blessed because I can afford it,” said Paulson, a tourist from the US.
Similarly, a tourist from Canada said that he did not mind paying USD 200 per night since that would only add to the quality of tourism services offered and would eliminate the crowds.
“I don’t know whether USD 200 is right or wrong, but I agree that the principle of paying it has to be there because without it, people coming in and out would not benefit the government. Moreover, it destroys the local infrastructure, and somebody has to take care of the local environment too,” he asserted.
The proprietor of a tour agency in Paro said that the decision made by the government to increase the SDF was good because it supports the tourism policy of the country. Moreover, it is a source of income for the state, where the government can invest in the infrastructural development of the country and the well-being of the people.
Since the opening of tourism in late September 2022, the industry has generated revenue of approximately USD 7.06M and Nu 46.68M (around USD 570,000) from the SDF. In 2019, the total earnings were USD 23.42M from SDF.
At this rate, Carissa said the SDF earnings after year one would be slightly lower or equal to the SDF earnings in 2019.
Article 14 of the sector’s constitution mandates that all taxes, fees, and levies, which include the SDF, be deposited into a Consolidated Account. By law, funds from this general account must cover government recurrent expenditure to ensure the stability and reliability of government operations. Residual revenue from this account is allocated to specific developmental activities, including building schools, providing free healthcare, skilling youth, maintaining forests and wildlife, providing fresh drinking water sources, renovating historical dzongs, and other initiatives.
In short, funds from this consolidated general account, including SDF contributions, are recurrent expenditures, which include salaries and interest payments on loans, to maintain stable and operational government services for the Bhutanese people and development projects selected by the government and outlined in Bhutan’s Twelfth Five Year Plan: 2018-2023 issued by The Royal Government of Bhutan’s Gross National Happiness Commission.
Carissa said that the implementation of the Tourism Levy Bill 2022 was a shock to the industry. “In the short term, the SDF will have an impact on the arrivals; however, the numbers will certainly bounce back,” she added.