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MINISTRY OF FINANCE ROYAL GOVERNMENT OF BHUTAN
Month: August 2017 ICT
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Vacancy Re-Announcement (17-Aug-2017)
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Vacancy Re-Announcement for the post of Sr. Program Officer under Investment Corporate Governance CSIS
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Amendment Notice (17-Aug-2017) SCS
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Amendment Notice for Construction of Chain link fencing and laying of base course at Gold Smith office
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Press Release on Fiscal Incentives (16-Aug-2017) ADS
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Posted on August 16, 2017 by Webmaster
Background: Fiscal incentives (FI) generally refer to temporary exemption of taxes and duties or granting income tax holidays for boosting private sector development and attracting foreign direct investment (FDI) to achieve broader economic development goals. Fiscal incentives are targeted to sectors that have potential for growth, export and employment generation amongst others. As permitted by the existing laws, the Lhengye Zhungtshog approved series of tax incentives as follows: 1. Tax incentives and rules thereof 2002 As authorized by the Income Tax Act 2001, MoF announced the first set of comprehensive fiscal incentive in the form of Tax incentives and rules thereof on 13th September 2002 to stimulate private sector growth and employment generation. Tax incentives in the form of tax holidays were granted to manufacturing entities, IT and Vocational institutes, Hotels, schools and auto-mechanical workshop in the interior regions. Exemption from BIT/CIT on all export earnings in convertible currency by manufacturing industries, IT service industries and Agriculture produce exporters and 20% re-investment allowance for incorporated companies were also included. Under the same notification, export tax on cash crop was abolished with effect from 1st July 2002. The tax holidays were available for business units starting commercial operation between 1st Jan 2003 and 30th June 2007. Since FI 2002 expired on 30th June 2007, industries starting commercial operation between 1st July 2007 and 31st December 2009 were granted tax holidays with effect from 1st January 2010 for the remaining period only as per FI 2010. Besides, indirect tax exemption on plant and machinery and raw materials have been provided as per the Rule No. 1.3 (Plant & Machinery) and Rule No. 1.4 (Raw Material) of the Rules on Sales Tax, Customs and Excise Act 2000 as authorized by Section 3, Chapter 2, Part I of the Sales Tax, Customs and Excise Act 2000. 2. Fiscal Incentives 2010 Based on the Economic Development Policy 2010, Fiscal Incentives 2010 was announced on 2nd April 2010. It was submitted to the 5th Session of the 1st Parliament on 25th June 2010 by way of information together with the National Budget Report for fiscal year 2010-2011. Additional list of items for exemption for hotel industry was approved in April 2013. Fiscal Incentives 2010 provided 56 incentives, of which 20 incentives expired as of Dec 2015 and 36 incentives are being continued under FI 2016. Total estimated revenue forgone through the implementation of the Fiscal Incentives 2010 for the period 2010 to 2015 was around Nu. 4,893 million. This also includes Nu. 186.59 million on account of ST and CD exemption for Hotel industries granted from 17th April 2013 till 31st Dec 2015. Total estimated revenue foregone from 1st Jan 2016 to 7th May 2017 through Sales Tax and Customs Duty exemptions on plant and machinery, raw materials, primary packaging materials and adventure tourism equipment which is valid until 31st December, 2019 as per Fiscal Incentives 2010 is around Nu. 1,104.68 million. 3. Fiscal Incentives 2016 Based on the Economic Development Policy 2016, the Government had approved the fiscal incentives 2016 with the objective to stimulate economic growth, foster private sector development and generate employment. The Fiscal Incentives 2016 was announced on 4th April 2017 with retrospective effect from 1st January 2016. Fiscal Incentives 2016 includes tax holiday, reinvestment allowance, income exemption, exemption of tax deduction at source (TDS), additional expenditure deduction, tax rebate and sales tax and customs duty exemptions. There are 60 different types of incentives under FI 2016, of which 36 incentives are the continuation from the FI 2010 and 24 are new incentives (9 direct tax incentives & 15 indirect tax incentives). FI 2016 was submitted to the 9th Session of the 2nd Parliament along with the National Budget Report for FY 2017-18 by way of information. The National Assembly, after lengthy deliberation on the Fiscal Incentives 2016, which was tabled as a report, resolved to process the Fiscal Incentives as a Money Bill. The Government, considering the long-term interest of the country and also to promote transparency for granting fiscal incentives, tabled the Fiscal Incentives Bill 2017 on 5th June 2017 which was accordingly passed by the Parliament. This has set the highest standard for granting fiscal incentives as a money bill in the future. Since the Fiscal Incentives Bill 2017 will be effective from 8th May 2017, the Hon’ble Speaker stated that if the need arises, the Parliament could consider requesting the Supreme Court’s interpretation with respect to the issue of incentives granted prior to 8th May 2017. Total estimated revenue foregone for the period April 2010 to December 2015 was Nu. 4,893 million. Similarly the revenue forgone for the period 1st Jan 2016 till 7th May 2017 is Nu 1,147.04 million. Of which Nu.1,104.68 million pertains to FI 2010 and Nu. 42.36 million is on account of new incentives granted under FI 2017. 4. Benefits of FI 2010 Of the hotels that availed incentives, 76 hotels have already contributed Nu.581.38 million in terms of Sales Tax on sales of food, beverages, room and other hotel services for the period 2010 to 2015. Under direct tax, a total of 116 taxpayers availed tax holidays and under indirect tax, a total of 545 entities representing different sectors availed ST and CD exemptions under FI 2010 for the period 2010 to 2015. The total employment generated as on 31st December 2015 (cumulative) was 5649 jobs. 5. Review of tax exemption provisions With the resolution to process fiscal incentives as money bill, the Lhengye Zhungtshog had decided to review all legal provisions which empowers the Government to grant fiscal incentives. In this connection Lhengye Zhungtshog had decided to submit the proposal for amending the following laws to the upcoming session of the Parliament as urgent bills:
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1. Income Tax Act 2001: Chapter 3, Section 8, Part I and Chapter 3, Section 9, Part II states that “On satisfaction and in the public interest, the Ministry may grant exemption and tax holidays to certain companies and businesses”. 2. Sales Tax, Customs and Excise Act (STCEA) 2000: Chapter 2, Section 3.2 Part I states that “on the satisfaction and in the public interest, the Ministry of Finance may exempt a person from payment of Bhutan Sales Tax”. Chapter 3, Section 5.2 Part II states that “on the satisfaction and in the public interest, the Ministry of Finance may exempt a person from payment of Customs duty”. 3. Customs Act 2017: As per Chapter 6, Section 47 of the Customs Act of Bhutan 2017, recently passed by the Parliament (9th Session) states that “The Ministry may exempt a person from the payment of Customs Duty in accordance with: The relevant international law, convention, covenants ratified by the Parliament; Any other laws in force; The social, environmental and economic policies of the Government.” 4. Any Act that has provision for tax exemption such as Civil Society Organization Act 2007, Religious Organization Act 2007, Parliamentary Entitlement Act etc. Conclusion For a developing economy, with limited domestic productive capacity, fiscal incentives will continue to play a pivotal role in strengthen economy by boosting private sector growth and attracting FDI. In view of the importance attached to the fiscal incentives, the Lhengye Zhungtshog decided that Fiscal Incentives must be processed as money bill as per resolution of the 9th session of second Parliament. In order to ensure that all laws are consistent with the decision, the Lhengye Zhungtshog has decided to propose the amendment of all the laws that empower the Government to grant fiscal incentives as urgent bills in upcoming 10th Session of the Parliament. Furthermore, Lhengye Zhungtshog requests the Hon’ble Speaker of the Parliament to consider seeking the Supreme Court’s interpretation with respect to the issue of fiscal incentives granted prior to 8th May 2017. With the submission of the Fiscal Incentives 2017 as money bill, the Government has paved the way for a Parliamentary debate in deciding the fiscal incentives to be granted. This is expected to ensure that fiscal incentives are provided in the priority sectors where there is potential for private sector growth, while eliminating potentials for vested interest and policy corruption.
Selection Interview (16-Aug-2017) Posted on August 16, 2017 by Webmaster
Selection Interview for the post of Attache at Royal Bhutan Consulate, Kolkatta
Auction Notice (14-Aug-2017) Posted on August 14, 2017 by Webmaster
Auction Notice for 19 Aug 2017
Selection Interview (11-Aug-2017) Posted on August 11, 2017 by Webmaster
SELECTION INTERVIEW FOR CHIEF INTERNAL AUDITOR & CHIEF ACCOUNTS OFFICER
APA 2017-2018 Signing (11-Aug-2017) Posted on August 11, 2017 by Webmaster
Annual Performance Agreement signed between Hon’ble Prime Minister and Ministry of Finance. The signing of Annual Performance Agreement for FY 2017-18 between the Hon’ble Prime Minister and Minister of Finance took place on 11th August 2017 at the Royal Banquet Hall.
The Annual Performance Agreement between the Hon’ble Finance Minister and the Finance Secretary and between the Finance Secretary and heads of Departments/division were also signed in presence of Hon’ble Prime Minister. Hon’ble Finance Minister highlighted some of the targets in the Ministry’s APA and reiterated Ministry’s commitment to achieve them. Hon’ble Prime Minister commended the Ministry of Finance and its officials for working hard and achieving goals and objectives of the 11th FYP.
APA Signing with DNB Director & Finance Secretary
APA Signing with DMEA Director & Finance Secretary
APA Signing with DRC Director & Finance Secretary
APA Signing with DPA Director & Finance Secretary
APA Signing with DNP Director General & Finance Secretary
APA Signing with DoS Director & Finance Secretary
APA Signing with PPD & Finance Secretary
APA Signing with IA & Finance Secretary
APA Signing with CCA & Finance Secretary
APA Signing with AASBB & Finance Secretary
Supply of Photocopy Machine, Laptop and Desktop (11-Aug-2017) Posted on August 11, 2017 by Webmaster
Supply of Photocopy Machine, Laptop and Desktop
Vacancy announcement for Foreign Transfer (8-Aug-2017) Posted on August 8, 2017 by Webmaster
Vacancy announcement for Foreign Transfer
Vacancy Announcement (4-Aug-2017) Posted on August 4, 2017 by Webmaster
Vacancy Announcement for the post of Personal Assistant & Driver for Directorate of Services
IRS selection interview schedule (3-Aug-2017) Posted on August 3, 2017 by Webmaster
IRS selection interview schedule
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A/C No. 0036 (BDBL) A/C No. 9999 (BoBL)
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