In a nation with an estimated population of 795,026 people, 127,243 cellphones were imported in 2024, meaning that almost one in four literate Bhutanese may have purchased a new gadget in the previous year. Mobile phones are subject to an 18% Goods and Services Tax in India, in addition to a 15% import tax. In India, an iPhone 16 starts at INR 79,900 due to this tax arrangement, yet in Bhutan, the identical model costs Nu 64,990. Due to Bhutan’s tax-free import status, this pricing difference provides Indian customers with an economic incentive to buy smartphones there, possibly resulting in the creation of a grey market. MoF has increased monitoring in response. The finance ministry is collaborating with the central bank to scrutinize foreign exchange usage and identify irregularities in import transactions, while also preparing regulatory actions against violators.
In order to better meet Bhutan’s larger fiscal and economic objectives, the government is also reexamining its import and taxation policies, possibly enacting tougher regulations or tax modifications. Tashi Infocomm Private Limited and iSpot Tech Distributor imported 3,840 and 3,776 units, respectively, while 8 Eleven topped the list by quantity with 26,460 units. There are wider economic ramifications to the growth in smartphone imports. The nation’s foreign exchange reserves, are strained by high-value imports like cellphones. Whether imports are being redirected to India. It’s possible that the nation’s tax-free status unintentionally encourages the grey market. To reduce unforeseen economic effects, tax policy changes may also be imminent.
