The recent lifting of Bhutan’s vehicle import moratorium, while intended to stimulate economic growth, has inadvertently highlighted a growing crisis of affordability and equality in the country. This policy, coupled with exorbitant vehicle taxes, threatens to exacerbate the exodus of Bhutan’s most talented professionals and widen the already concerning gap between the rich and poor.

Article 7(13) and Article 9(1) and (2) mandate the state to ensure quality of life for all citizens and promote conditions enabling Gross National Happiness. These provisions reinforce non-discrimination and align with our constitutional principles. However, the growing inaccessibility of private transportation for most Bhutanese directly conflicts with these ideals.

The stark reality of vehicle affordability in Bhutan is alarming. According to the National Statistics Bureau, the mean monthly household expenditure in Bhutan is Nu. 52,813. Contrast this with Australia, where the average monthly salary in 2024 is approximately AUD 7,600 (roughly Nu. 423,000). This disparity becomes even more striking when considering vehicle costs. In Bhutan, even a basic family car can cost several million ngultrums, often exceeding five years’ worth of an average household’s income.

Consider the plight of professional civil servants, many of whom earn as little as fifty thousand ngultrums per month. The report reveals that housing rent alone consumes about 37 percent of monthly income for many. Now, factor in that the cheapest car would cost more than their entire annual income. For lower-income civil servants and workers in other sectors, the prospect of owning a family car becomes a multi-year sacrifice of every earning—an unrealistic proposition for most.

The government’s argument about traffic congestion as justification is misleading. Only one or two towns in Bhutan face traffic issues, while the rest of the country is becoming increasingly deserted, suffering from a lack of adequate public transport services. The BLSS 2022 data showing that only 5 percent of students use public transport underscores this dire need for improved services.

Financial inclusivity is another key area for reform. The NSB data shows that bank loans are the most common source of funds (35.9% of loans), and financial inclusivity is a major challenge. Many lower-income Bhutanese struggle to access affordable financing. Financial institutions are reluctant to provide any financial services without collaterals such as land or properties which must in urban areas only. 

The 13th Five Year Plan’s ambitious goal of transforming Bhutan into “a high-income country driven by innovation and sustainability” seems increasingly out of reach under current conditions. The government must urgently reassess its vehicle tax policy if it is serious about achieving this plan. The government’s efforts to attract Bhutanese expatriates back home, particularly from countries like Australia, are likely to falter in the face of such economic realities. More alarmingly, this situation may accelerate the departure of more productive and professional Bhutanese in search of better opportunities abroad as they find themselves unable to afford even basic amenities like a small family car. The risk of Bhutan becoming a nation predominantly populated by the very young and the elderly is real and imminent.

The government must act swiftly to address the vehicle affordability crisis. This calls for a multi-faceted approach-implementing income-based vehicle taxation, improving nationwide public transportation, and providing accessible vehicle financing options. GNH can become a reality for all Bhutanese, regardless of economic status, if we can align our policies with constitutional mandates and social protection goals.

Sonam Tshering

Lawyer, Thimphu

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