The National Assembly endorsed the double taxation avoidance agreement between Bhutan and Bangladesh yesterday.
Signed during the visit of Bangladesh Prime Minister Sheikh Hasina to Bhutan in April 2017, the agreement plans to do away with double taxation of incomes between the two countries.
In the presence of 38 MPs, the House passed the agreement with all “yes.” The Bill will now be forwarded to the National Council for deliberation and endorsement.
Moving the motion to pass the Bill, Finance Minister Namgay Dorji said that lack of such an agreement between the two countries has led to double taxation on incomes of individuals and businesses operating in each other’s country.
“The agreement will also boost cross-border investments and trade between the two countries,” he said.
Lyonpo Namgay Dorji said that the ratification of the agreement would benefit Bhutanese airline businesses as they would not be liable to pay tax on cargo and passengers boarding from Bangladesh. He said double taxation on income of non-diplomat Bhutanese working in Bangladesh would be eliminated.
The ratification, he said, would also curb cross border tax evasion since the agreement provides for exchange of information and assistance in collecting taxes between the two countries. “The agreement will also attract potential investments from Bangladesh,” he added.
In an earlier discussion on the Bill, all members spoke in favour of passing the bill although some members pointed out inconsistencies between the English and Dzongkha versions of the agreement.
Panbang MP Dorji Wangdi said that the agreement does not contain a clause on expiry of the agreement. “It would have been better if there was a clause prescribing the life of the agreement after which it can be renewed,” he said.
Speaker Jigme Zangpo said that any inconsistencies in the translation should be harmonised. “The committee will sort out the issues related to translation from English to Dzongkha,” he said after passing the agreement.