The Property Tax of Bhutan 2022, which was passed by the Parliament during the 8th Session of the Third Parliament will be enforced beginning this year. Property owners will have to pay much more than what they used to. There has been no formal public outbursts. Neither have people resorted to public domains like the favoured social media to vent their fury. And this ensues from the belief that local governments (LGs) and the thromdes will churn the taxes paid back to the public in the form of better service delivery. In other words, citizens, especially those in urban areas, are confident that there will be Tax-performance continuity, which is an augmentation in service delivery, both in terms of quantity and quality when taxes are increased. There is thus, a willingness to pay.
From this prism, it becomes very vital for those heading the LGs and thromdes to ensure that people feel the differences between services delivered when the taxes were low compared to what they experience with the revision. If there is no substantial progress, taxpayers will begin questioning the merits of increased taxes.
This is pertinent especially for urban areas like Thimphu, which is home to people from all across the country. The city continues to battle the pressure brought about by urbanization. Its population in 2021 was 154,378. Though we do not see challenges that come in the forms of slums, restoration of deteriorated structures and others, in its stark reality, these are breeding in different parts of the city. Funds have been a problem and though the taxes collected would be centralized, Thimphu thromde would be receiving far more than what it used to. With enhanced ability to collect revenues, the thromde should be in a position to provide effective, responsive and more accountable services to the citizens.
Currently, there are both issues and scope for development. It starts from basic needs, like safe and sustained drinking water to concerns associated with the city’s drainage system and waste management. There is never a monsoon where residents of the capital are spared the agony of witnessing the city drowned by water from clogged drains. The pain becomes excruciating, when this happens in the heart of the city, just next to Bhutan’s prized identity – the main traffic junction in town.
People should not be made to think that the purpose of any increase or collection is just for revenue. As mentioned earlier, people’s willingness to pay arises from the belief that there will be performance improvements. If this does not happen, questions will be asked.
It is crucial to understand that people are stimulated to participate and contribute to their city’s planning and prioritisation processes. Many residents of Thimphu will not mind paying extra. While there were some questioning the merits of the revised Property Tax 2022, there were more who agreed that the Property Tax 1992 needed revision. Property owners said that they did not feel the need to pay more taxes as the concerned agencies had never asked them to do so.
As LGs and thromdes begin collecting the revised taxes, the fact that this is the first time should not be forgotten. People are willing to pay more. But this willingness comes with expectations that service delivery will improve. And the people are watching.
