The urban tax paid by residents in extended areas of Rinchending and Pekharzhing under Phuentsholing Thromde from 2011 to 2015 would not be refunded, the works and human settlement minister Dorji Choden said at the meet the press session on August 4.
Earlier in May, Kuensel met with several farmers from Rinchending and Toribari extended areas who sought government intervention, as thromde did not refund the urban taxes. The residents claim that the areas did not have basic urban facilities and should not be taxed for these facilities.
The people raised the issue following the refund the government made in 2016 in Trongsa when Weeling villagers pointed that they did not have urban facilities. Weeling village had then come under the thromde extended area.
Lyonpo Dorji Choden said that the Trongsa villagers were asked to pay urban tax after the government issued a notification in June 2016.
“It was when we were identifying thromde areas,” she said. “Rural areas also had fallen under thromde.”
Lyonpo said that the government decided to resume the old rural tax system, as there were no facilities required as per the thromde and people were asked to pay urban tax.
“So we decided to give compensatory incentives,” Lyonpo Dorji Choden said, pointing that it was never a tax reform. “It was not applicable for Phuentsholing.”
Lyonpo said there are many cases similar to Phuentsholing’s in other places. These taxes were paid as per the policy directives and cannot be changed.
In 2016, the works and human settlement ministry withdrew the urban tax and provided incentives to all people who paid urban tax in extended areas that did not have basic facilities.
This decision also came in line with basic infrastructure and facilities not being placed in such areas wherein landowners were not benefitted economically.
The rural tax was once again reinstated in extended areas under thromde.
In Phuentsholing, extended areas were taxed (urban) between Nu 0.25 – Nu 0.125 per square foot (sqft) for 2011 and 2015. Villagers in Toribari had even sold lands when they could not afford to pay the tax.
Some had mortgaged their areca nut trees.
Meanwhile, for a place to be taxed urban tax, it needs to have access to motor-able urban roads, electricity supply, solid waste disposal water drain, drinking water supply (private or public), and sewerage (on site or centralised).
Rajesh Rai | Phuentsholing