According to a report on business regulatory procedures, businesses are finding it difficult to fully utilize the tax breaks and benefits because of complex procedures and other obstacles, even though they have allegedly aided in economic growth and job creation. To assist companies in recovering from the effects of COVID-19, the Fiscal Incentives Act of Bhutan 2021 was introduced. Many businesses find it difficult to comprehend the policies, which makes it difficult to claim the benefits, so they say the rules are confusing. Due to unequal distribution, certain industries are only allowed to receive one vehicle quota, regardless of the number of tourists they attract. The incentives are intended to benefit businesses, especially if they result in higher government spending and lower tax revenue.
The government was given policy recommendations in the report, including the necessity of streamlining regulations and giving firms precise instructions so they can apply for incentives more easily. According to the report, comprehensive cost-benefit analyses should be carried out, alternative funding sources should be investigated to compensate for possible revenue losses, strong monitoring and evaluation should be put in place to gauge the impact of the program, and data should be used to optimize them. Many call for greater transparency in the system along with a push for more lucid information and robust public oversight mechanisms. Companies are also responsible for training and assisting businesses, particularly small and medium-sized businesses, in making the most of the incentives that are available.
