Recently, the government introduced Nu 10 as a fee to enter and exit the international gate in Phuentsholing. This is the second time that the Department of Immigration has levies fees, first for foreigners who are not tourists and now for everyone entering the Phuentsholing gate. While the amount may be nominal, levying such a fee raises serious questions if the executive has the authority to impose any fees without the approval of the parliament.

Explaining the intent of Article 14 (1) of the Constitution, the Chairman of the Constitution Drafting Committee noted: “it is important that taxes, fees, and other forms of levies are authorized by law. No taxes or fees should be imposed on an ad hoc basis and no government or organization should act without deference to law and burden the people.”

In the case of Opposition v. RGOB (2011), the Supreme Court explained Article 14(1) elaborately.  The court said that “taxes can be imposed or altered only by Parliament” under Article 14(1) which “pertains to the supremacy of Parliament to impose taxes as representatives of the people. The relevant provision of the Constitution clearly mandates and embodies the important constitutional principle that no tax shall be levied or collected except under the authority of law. The argument of the Government regarding delegated authority to impose “indirect taxes” and the need to raise such taxes every now and then does not have a legal basis. The tax authority has been vested in Parliament to ensure adequate checks and balances, avoid arbitrariness, limit discretion, and ensure compliance with due process in a democratic system of governance. The raising, collection and expenditure of the revenue and all matters related thereto must be governed by strict rules of law. The basic issues pertaining to the source of revenue, the authority for expending the public revenue and the securities provided by law for the due appropriation of the public revenue and ensuring that it is expended in the exact manner which the law directs.

Further, the court said that “the Constitution does not differentiate direct and indirect tax. Article 14(1) leaves no room for further interpretations. Therefore, the argument of the appellant that there exists a separate law related to direct and indirect tax is an assumption and hence not tenable.” Further, Article 20 (8) prohibits the Executive from issuing any order circular, rule or notification which is inconsistent with or shall have the effect of modifying, varying, or superseding any provision of a law in force. His Majesty said that “we strengthen the Rule of Law and through the Rule of Law, we consolidate institutions of check and balance. The failure of justice persecutes an individual, but the lack of adherence to rule of law persecutes an entire nation.” This is intended to prevent possible abuse of authority by the Executive as they are political parties with vested interests.  For instance, next time an agency may impose pay fees to enter other public buildings, even drive on some new infrastructure and so on. Therefore, the Executive and its agents must function within the ambits of the constitution to uphold the rule of law. The government of the day has the right to impose taxes and fees to generate revenue but must be done only legally.

Sonam Tshering

Lawyer, Thimphu

Disclaimer: The views expressed in this article are author’s own.