The rollout of the Goods and Services Tax (GST) has triggered widespread confusion among consumers and vendors, exposing gaps in planning and public communication. While GST is designed to modernize the tax system, expand the revenue base, and simplify transactions, the early phase of implementation has created frustration in the marketplace.
A major concern is the overlap between GST and the existing Bhutan Sales Tax (BST). Retailers holding stock purchased under the old tax system are now expected to apply GST on goods already taxed, creating the impression of double taxation. Consumers feel unfairly burdened, questioning why they must pay tax twice on the same products. Vendors, meanwhile, are struggling to adjust pricing, remain compliant, and maintain customer trust amid unclear regulations and inconsistent interpretations.
Experiences from countries like India and Malaysia show that indirect tax reforms require strong preparation, transitional relief, and continuous support for businesses. Without clear guidance, GST can disrupt buying behaviour, reduce purchasing power, and even push consumers toward informal markets.
To reduce confusion, authorities could introduce a transitional window for existing stock, issue simple scenario-based guidelines, and strengthen support tools such as helplines, online resources, and sector-specific advice. Consulting business associations can also help identify practical challenges early.
GST remains a valid reform with long-term benefits, but better implementation, clarity, and fairness are essential to restore confidence and ensure a smooth transition.
