GST collection much below target as of 11th March

2026-03-16 - 11:05

The internal target of the Ministry of Finance (MoF) for the Goods and Services Tax (GST) collection is Nu 6.8 billion (bn) for six months from January to June 2026 with an average monthly target of Nu 1.133 bn. However, as of 11th March 2026, the total GST collection which includes GST collection for January, February and till 11th March is only Nu 1.552 bn of which Nu 1.314 bn is GST on imports charged at entry points like Phuentsholing, Gelephu, etc., Nu 229.5 million (mn) from domestic sources and Nu 9.16 mn from government services. The last date of filing for GST for January expired by 4th March 2026, but an informal extension has been given as people are still being encouraged to file without the fines. As of the latest available data, Nu 608 mn was filed for January, with around 87 percent of registered filers having submitted their returns by 6th March 2011. This is well below the average monthly GST collection of target of Nu 1.133 bn with a shortfall of around Nu 400 mn below the target. Last time around, the GST collected as of 2nd March 2026 was Nu 1.189 bn with 78.14 percent filing for January, but it also included import GST collected for February and two days of March. One could make the argument that while the GST filing deadline for February is 30th March 2026, and figures may improve for February, as more people file, but what must be considered is that the vast majority of the February GST collection is already done at the entry points for imports. The remaining amount would be domestic filers who would push up the amount but not significantly. The Nu 1.552 bn GST also involves the GST on imports for the first 11 days of March 2026. At the current rate, it looks like the Nu 6.8 bn GST target for January to June 2026 may not be achieved, and it also puts into question the Nu 14 bn GST target for 2026-27 financial year. In comparison, the Sales Tax collected for 2024-2025 financial year was Nu 9.603 bn considering that Sales Tax was not imposed on most services and many basic food items, as it is now for GST. If the GST collection for January is taken as the average, then it would be even below the old Sales Tax. The below target collection so far also begs the question of whether it reflects the weakened nature of the economy still recovering from