Tour operators welcome royalty waiver

Many tour and travel operators in the country feel that the waiving off of Sustainable Development Fee (SDF) or tourism royalty of US$ 65 per day for tourists visiting eastern Bhutan will have positive impact and bring the much-needed development in eastern Bhutan.

This is following the adoption of the Tourism Levy Exemption Bill of Bhutan 2017 which was passed by the National Assembly on Thursday. The SDF of US$ 65 is today levied in the minimum daily tariffs, which are US$ 200 and US$ 250 during the lean season and peak season respectively.

The government also envisions that waiving off of the SDF, for a period of three years from December 2017 to December 2020, will boost the number of tourists visiting the country and generate revenue. This has also been done in the wake of only 2% of the tourists, which will be around 1,000 tourists, visiting eastern Bhutan as of now.

The Chairman of the Association of Bhutanese Tour Operators (ABTO), Rinzin Ongdra Wangchuk said the waiver of the SDF passed by the parliament as a Money Bill is an indicator showing the importance given to tourism by the government.

“It shows the will of the government to support not just on paper but implement as well,” he said, adding that tourism identified as one of the five jewels by the government is significant.

He said the economic benefits and opportunity for our youth to engage in tourism logistics and services in the six Dzongkhags are enhanced to a higher level, while the citizens are also given an opportunity for investments in hotels and restaurants.

“The government has been continuously investing in product development in six Dzongkhags for trekking routes, day hikes and investing in restrooms. The improvement and investment made in the domestic airport at Yonphula with scheduled flights provide an option for tourists to fly,” he added.

Rinzin Ongdra Wangchuk said waiving off royalty for eastern part of the country does not mean the benefits and new opportunities will go to the east only.

“The other Dzongkhags form separate circuits. The arrivals to western and central Dzongkhags will also increase with tourist flying into Paro for the eastern circuit. Starting from the two airline operators, it would trickle down to a horseman and overall increase in foreign exchange income from tourism will be substantial. Tourism Council of Bhutan has to be provided further budget for marketing and promotion to fully support the eastern Bhutan SDF waiver,” he said, adding that tour operators welcome the initiative.

The chief executive officer of Yangphel Adventure Travel, Karma Lotey, also applauded the royalty waiver initiative; describing it as one of the best initiatives undertaken by the government.

“I am sure tourism stakeholders are happy about it. It is a step in the right direction,” he said, adding that the initiative was in discussion for nearly a decade and it was about time to take some bold steps and remain hopeful that it would happen.

“There are a plenty of tourism products in the east and an impetus is needed to harness the potential of the east. It will immensely benefit the spread of tourism across Bhutan along with boosting tourism activities and benefiting the communities there,” Karma Lotey said, adding that the initiative with a sunset clause of five years would also give policy makers an opportunity to revisit its implications.

Karma Lotey also reiterated that the royalty waiver would promote sustainable tourism and bring about equitable distribution of benefits to the tourism industry and local communities.

“Although the royalty is waived off, the daily tariff is still to be charged and will not undermine the sustainability aspect. We are glad that this time it is the government yielding the royalty to promote which tour operators can take advantage to promote tourism in the east; eventually providing the equitable distribution of the tourism benefits that was always talked about,” he added.

Similarly, another tour operator, who wants to remain anonymous, said this is the best and only solution to promote the east.

“It will benefit in promoting tourists in eastern region since price is the ultimate factor for anyone to select holiday destination. The Opposition MPs are making hue and cry, but what they need to realize is, anyway, the government is not losing any revenue since hardly any tourists visited the east. So how would government lose the SDF when only 2% tourists visited the east? Besides, we still need to pay BIT to the government with more tourists in the east, so there is revenue generated,” he added.

Meanwhile, hoteliers in eastern parts of the country also welcomed the initiative. They feel that it will boost the economy and tourist arrival in eastern Bhutan.

The General Manager of the Druk Deothjung Hotel in Trashigang, Jambay Yudon, said the arrival of tourists in eastern Bhutan declined after the widening works of the East-West Highway. “Now with the waiving off of royalty we are hopeful that the number of arrival will increase and bring changes in the region,” she said, adding that tourists did not visit eastern parts of the country earlier because it took long duration and tourists also had to pay royalty.

Meanwhile, the MPs from the opposition party questioned that the waiving off of royalty will undermine the ‘High Value Low Impact’ policy during the third reading of the Tourism Levy Exemption Bill last week. It was also raised that the waiving off of royalty overlooks the concept of equitable balanced regional development.

TCB had recommended the waiving off of royalty for the six eastern Dzongkhags.

Dechen Dolkar from Thimphu