The Opposition yet again picked on the government’s frequent changes to the Sustainable Development Fee, SDF and their impact on the tourism industry, during the National Assembly session yesterday. The industry, commerce, and employment minister, however, said the revisions in SDF have relatively added more revenue as compared to the pre-pandemic situation.

During the session, Dramedtse_Ngatshang’s Member of Parliament Ugyen Wangdi raised concerns about the frequent changes in the SDF, which have been causing challenges for businesses within the tourism sector.

“Lowering the SDF to USD 100 will be very helpful, but since the ceiling of USD 200 is not certain, it might give rise to issues if the new government changes the SDF again after the current government’s term ends. It would help if it were reflected in the constitution immediately. I would like to know what plan the minister has in place to prevent such issues.”

In response, industry, commerce, and employment minister, Karma Dorji said that future changes to the SDF would require a two-year notice to all relevant stakeholders if a new government decides to do so.

“This year, we received around 89,000 tourists, which generated a revenue of around USD 22 M. In 2018, even if we received around 300,000 tourists, we were able to generate only around USD 23 M. So, the USD 200 SDF is the ceiling and I believe lowering it will only help businesses and not upset them.”

However, businesses in the tourism sector have yet to benefit from the recent slash in the SDF for dollar-paying tourists.

“Business has not recovered much after the pandemic. Tourists do come here, but only a handful of them buy our products. I have talked to some of the tour guides, but they say the tourists do not buy Bhutanese handicrafts much anywhere else either,” said Rinchen Dema, a handicraft vendor.

“I think our businesses are nowhere near how it was before the pandemic. On top of tourists not buying much of our products, I’ve noticed that even fewer tourists are coming into the country with the revised SDF rate,” said  Gomchen, another handicraft vendor.

When BBS got in touch with hoteliers and guides, they said that most of the tourists visiting the country right now are Indians. And the other dollar-paying tourists are mostly those who made reservations on the old SDF.

They say that it is still too early to know if the lowering of the SDF to USD 100 will help increase the number of tourists coming to the country.