By Phuntsho WANGDI | 29 November 2012
After its repeated calls to government institutions to pay the pending land tax fell on deaf ears, the Thimphu Thromde has surrendered the land occupied by them to the National Land Commission
The Thimphu Thromde has surrendered lands of some of the government institutions and organizations after repeatedly asking them to pay long over-due land taxes.
The Thimphu Thromde had set October deadline for the government institutions and organizations to pay the land taxes and also warned that if they fail to pay the taxes their land will be surrendered to the National Land Commission.
According to an official from Thimphu Thromde they have already surrendered the land to National Land Commission and have made the assessment of the revenue.
The Thimphu Thromde refused to divulge details of the land surrendered.
The National Land Commission also confirmed that the Thimphu Thromde has surrendered the lands and it is in the process of assessing the ownership legality.
Earlier Thimphu Thromde mentioned that Royal Bhutan Police (RBP), Royal Bhutan Army (RBA), National Housing Development corporation, old Forestry Housing in Taba, Ministry of Economic Affairs staff colony and religious entities have not paid the Thromde, an amount summing up to more than Nu 20mn.
It is noted that that religious entities from Chang and Kawang area need to pay land tax of Nu 1.7mn every year.
The RBA and the RBP that occupy huge swathes of land in the municipality haven’t paid taxes till date.
The RBA covers approximately 368 acres of land and must pay Nu 8mn a year as tax. Similarly, the RBP occupies an area of 28.7 acres of land which amounts to Nu1.3mn tax a year.
The National Housing Development Corporation’s housing complexes (NHDC), situated in the core as well as the peripheral areas of the municipality with land holding of 3,068,605.98 sq.ft hasn’t made any tax contribution to the Thimphu Thromde and has to pay Nu 1.2mn as tax every year.
Earlier a Thromde official said that after the land was surrendered to the Land Commission, government institutions will have to register land again in their institutions’ name and start the process all over again.
Land tax rates adopted in 1992 for the core areas is Nu 0.25 per square feet (sq ft) for residential areas and Nu 0.50 per sq ft for commercial areas. The same rates are applied to extended municipality areas.
The Land Act of Bhutan 2007 states that except for crown property, all registered land under the municipality should pay land taxes including land belonging to government institutions and religious entities.
Section 224 of the Land Act says if land tax is not paid for three consecutive years, the local authority will notify the landowner at the end of the third year to pay the tax with arrears.
In 2011, TDM generated Nu 78mn as revenue from land tax. This year it expects that land tax levy will reach the Nu 100mn. TDM received Nu 34mn from the private tax payers alone.
For the year 2011-12 the Thromde managed to collect Nu 110mn as tax revenue.