Prime Minister Tshering Tobgay will be in National Council (NC) today where he will be questioned about the “government’s failure” to adopt a tourism policy and to table a tourism bill in Parliament.
NC in its 16th session in December 2015 had passed a resolution calling on the government to immediately implement these two recommendations. The government has not implemented the both.
According to NC, lack of a comprehensive policy has hindered planning and coordination for the development, promotion and regulation of the tourism sector.
Having a policy and a tourism Act to regulate the sector, NC says, will also provide clarity on what “high value-low impact” of Bhutan’s tourism industry stands for.
NC had also asked Royal Audit Authority (RAA) to conduct a special audit to examine, among other malpractices, possible tax evasion. Accordingly, RAA conducted a performance audit of the sector and submitted the findings to NC’s economic affairs committee on April 20.
After a brief presentation of the report on May 15 by the committee, NC decided to invite the prime minister to the house of review for questioning. The prime minister is also the chairperson of the Tourism Council of Bhutan (TCB).
PM Tshering Tobgay is expected to outline the government’s plans and policies for the tourism sector, which he has described as one of the “five jewels” of the economy. Tourism is one of the most important sectors that generates revenue, employment and earns convertible currencies.
In the financial year 2017-18, TCB aims to promote Bhutan as an exclusive travel destination, develop tourism infrastructure and promote cooperation with regional and international organizations. For this, the government has allocated Nu 109 million.
Presenting the RAA’s report to the house, Gasa’s NC member Sangay Khandu said that the economic affairs committee also conducted a study of its own last year on the tourism sector and that the findings of RAA and the committee were similar.
“Then the 49th plenary meeting held on April 11 directed the committee to draft questions to be asked to the prime minister about why the government failed to adopt a tourism policy and table a tourism bill as recommended by NC,” Sangay Khandu said.
The house also decided to submit the RAA report to a joint sitting of Parliament through the public accounts committee.
The chairman of the economic affairs committee, MP Sonam Dorji, said that the audit report has acknowledged that there are avenues for malpractices such as undercutting by tour operators. “However, RAA was not able to concretely prove existence of undercutting and tax evasion,” he said.
The RAA report has also recommended TCB to prioritise formulation of a tourism policy and also to adopt tourism bill. It has asked TCB to regulate regional tourists in conformity with the principle of “high value and low impact”.
“TCB should integrate tourism activities in dzongkhag development plans,” the report states. As per the recommendations of RAA, the TCB should review its pricing structure to make it more responsive to the pace of global economic development.
According to NC, the benefits of tourism are not spread evenly across the county and that tourism activities are mostly concentrated in the west.
Some of the reasons for lower visit rates in the east are attributed to poor quality of roads, lack of roadside amenities and long travel distances among other problems.
NC also feels that some tour operators could be practicing undercutting. Undercutting involves selling tour packages below the government set minimum price of USD 200 and USD 250 per person per day.
There are also rising concerns that some people act as tour operators for larger tour companies based abroad and actively engage in undercutting. This, according to NC, leads to leakages of profits and foreign currencies.