Bhutan Proposes Tax Breaks Until 2040 for 25GW Renewable Energy Goal
The Renewable Energy Tax Exemption Bill of Bhutan 2026 was introduced, proposing tax breaks to attract investment in renewables until 2040. This legislation aims to bolster Bhutan's energy security and economic growth by facilitating the development of hydropower, solar, and other renewable energy projects.
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The Renewable Energy Tax Exemption Bill of Bhutan 2026 proposes time-bound tax breaks to stimulate investment in renewable energy sectors, including hydropower and solar. Exemptions on indirect taxes for project inputs and the Property Ownership Transfer Tax will remain until Bhutan achieves its 25GW target or by December 31, 2040.
The Bill defines eligible renewable energy activities, establishes a two-stage approval process, and specifies that only direct inputs linked to approved projects qualify for exemptions. Currently, only 14.7% of Bhutan's hydropower potential is developed, indicating a significant opportunity for investment and growth in this sector. The approval process aims to ensure that tax benefits are strictly tied to renewable energy projects.
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