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Rate increase proposed to support the Tourism council secreteriat

Date : Mon Sep 24 14:27:20 EDT 2012

Tourism Council of Bhutan: Tour operators are reconsidering their earlier stand and have come up with a proposal to support the secretariat of the tourism council, which is to be delinked from government.

The association of Bhutanese tour operators (ABTO) is proposing an increase in royalty of USD 5 a tourist a night during high and lean seasons, the proceeds of which will be used to run the secretariat. This proposal should be applied by 2014.

The council secretariat had proposed increasing royalty by USD 15 during high season, and USD 10 during lean season, to create its running budget. The other option was to be given 25 percent of royalty, collected as its operational budget.

'We feel that USD 5 is reasonable enough when done on a tourist a night basis,' the ABTO president, Karma Lotey, said

Karma Lotey said the government has delinked the secretariat for the benefit of the tourism industry. 'Therefore, tour operators should find a way to support it, by looking at the positive and merit of it,' he said. 'We just can?t shoot down any such decision from the government, but rather meet halfway, through dialogues and proposals, to come up with what's best for the industry.'

The draft minutes of the meeting held between TCBS, ABTO board members and some tour operators on August 22 states the royalty increase is a decision that will go through mainly because of the financial constraint faced by the government.

On ABTO's proposal being applied from January 1, 2014, tour operators said was because tour packages until 2013 end had already been sold. 'We don?t see any problem if it's implemented from 2014, as we'll have ample time to notify our counterparts of change in the tariff, if royalty goes up,' said one.

ABTO is also proposing the secretariat collect USD 3 a tourist, a visit, at source from tour operators for ABTO?s sustainability, which until now was collected by approaching the tour operators individually.

Earlier USD 10 was collected as tourism development fund by TCB, a portion of which went for ABTO?s sustainability. However, due to transparency issues, it was done away with in 2008.

In 2010, it was decided that tour operators, who were ABTO members, would voluntarily contribute USD 3 a tourist, a visit for its sustainability. Almost all members contributed, although it was voluntary. From USD 3, USD 1.5 a tourist, a visit, went to His Majesty?s kidu fund.

Today, the minimum daily tariff of USD 250 and USD 200 from a tourist is deposited with TCB's account, from which the royalty of USD 65 and USD 55, along with two percent tax is deducted, and goes to government coffers. The remaining amount is for the tour operator.

There are more than 400 registered tour operators today. Last year's annual tourism monitor report stated that the sector?s gross earnings was USD 47.68M, of which, the royalty collected was USD 14.89M.


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