The PIT collection as of May 8 this year constitutes 92.16% of the total collection of the previous year
The Personal Income Tax (PIT) collection for the income year 2021 has decreased by 7.84% compared to 2020 due to the reduction or loss of income effects caused by the pandemic and late filers.
However, a collection of Nu 1.3bn was made as of May 8 this year.
According to the Ministry of Finance (MoF), a total of 56,973 PIT payers filed their tax returns as of May 8. Compared to the total filers for Income Year 2020, for the Income Year 2021, around 8,552 people didn’t file their tax returns.
“This is because the PIT exemption threshold has been revised from Nu 200,000 to Nu 300,000 as per Section 10 of the Income Tax (Amendment) Act of Bhutan 2020,” an official from the MoF said.
The official said that compared to the income year 2020, the PIT collection for the income year of last year has decreased by 7.84%.
He divulges that tax reduction or loss of income due to the effects of the pandemic, and late filers are expected to file tax returns in the coming days.
The MoF shared that with the Gross Domestic Product (GDP) for the year at Nu 201bn, the PIT collection is Nu 1,314.761mn as of May 8 this year.
It is only 0.5% of the GDP, the official said, adding that the PIT collection as of May 8 this year constitutes 92.16% of the total collection of the previous year, which is Nu.1426.625mn for the income year 2020 collected last year.
Meanwhile, in keeping with the fiscal and monetary measures, during the income year 2021, only a 50% bank interest waiver was allowed as a deductible expense.
The deadline for the payment of PIT has been extended from February 28 to March 31 given the Covid-19 situation, the Department of Revenue and Customs (DRC) notified last year.
The DRC has also extended the deadline for payment of Business Income Tax (BIT) and Corporate Income Tax (CIT) to April 30.
It has also been shared that filing after the due date shall attract the following fines and penalties as per the Income Tax Act of the Kingdom of Bhutan 2001.
The official said that a person will be levied with applicable fines and penalties for late filing and late payment of tax as per the provisions of the Income Tax Act.
The DRC stated that taxpayers have faced challenges in the submission of tax returns.
A penalty of Nu 100 per day in addition to a 24 percent penal interest on the tax payable shall be applicable after the expiry of the deadline. Tax filing after three months from the due date will attract a non-filing penalty by the Income Tax Act of Bhutan.
The DRC issued a notification a week after the department launched the BIT Estimated Tax App (BETA), a mobile app through which taxpayers can file their tax returns.
The BETA was launched to reduce physical interaction as well as to supplement revenue administration and management information system or RAMIS.
The app is aimed at benefiting 30,000 businesses paying BIT across the country. BETA will not only increase the efficiency of tax assessment, payment, and collection but also reduce the administrative cost, according to the MoF.
Kinley Yonten from Thimphu