Bhutan’s New Sustainable Development Fees.

The Royal Government of Bhutan has recently introduced an extensive set of incentives and policy initiatives aimed at revitalizing the nation’s tourism industry. Notably, a significant step in this direction is the reduction of the daily Sustainable Development Fee (SDF) by 50%. 

This strategic decision underscores Bhutan’s acknowledgment of tourism’s pivotal role in job creation, foreign exchange generation, stimulation of ancillary sectors, facilitation of overall economic growth, and its support for vital environmental, social, and infrastructure projects.

The newly introduced measures encompass the following significant points:

  1. A substantial reduction of 50% in the current Sustainable Development Fee (SDF) rate of US$200, resulting in an adjusted SDF of US$100 per person per night.
  2. Additionally, there is a corresponding 50% reduction in the SDF rates applicable to children aged between 6 and 12 years. This adjusted SDF rate for children now stands at US$50 per person per night, with children below the age of six being exempt from SDF payments.
  3. The existing 24-hour SDF waiver for tourists staying in border towns will remain unchanged.

These measures will officially take effect on September 1, 2023, and will remain applicable for a duration of four years, concluding on August 31, 2027.

These incentives underscore Bhutan’s distinctive approach to tourism policy
Bhutan’s distinctive approach to tourism policy

These incentives underscore Bhutan’s distinctive approach to tourism policy, emphasizing its unique alignment with the country’s character. Recognizing the importance of adapting to change and periodically refining our policies and strategies to align with evolving market conditions, Bhutan has temporarily reduced our Sustainable Development Fee (SDF) to rejuvenate our tourism sector.

Since 1974, Bhutan’s “High Value, Low Volume” tourism approach has necessitated the payment of the Sustainable Development Fee (SDF). The proceeds from the SDF contribute to various critical areas, including conservation efforts, healthcare initiatives, cultural preservation, and more.

The Royal Government shall conduct periodic assessments of the domestic and international tourism scenarios and may discontinue the above incentives to uphold and promote High Value Low Volume Tourism Policy of Bhutan after 31 August 2027.

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