Undercutting is illegal: PM
Undercutting is illegal said the Prime Minister Dasho Tshering Tobgay at the meet the press session on 27 December in Thimphu. It is illegal that’s why government has put it in a robust system to prevent undercutting.
Lyonchhen said that undercutting begins with the tour operators being required to transfer the full amount of funds to Tourism Council of Bhutan (TCB).
The tour operators must collect the full tariff from the tourist and transfer the amount to TCB accounts before the TCB grants visa. There is a bit of monetary also, said the Lyonchhen.
Lyonchhen also added that “We hear lots about the undercutting but unfortunately that’s why it is all hearsay.”
Lyonchhen said that they can’t allow undercutting for a simple reason; it goes against the policy of high value and low impact of tourism. Fixed tariff has been determined, so that we on one hand can control undercutting and on other hand to allow tourist to visit Bhutan to have the best possible experience, for that money is required and therefore we have set a minimum tariff. It is not a fixed tariff but a minimum tariff.
However Lyonchhen said that, despite of fixing minimum tariff many tour operators charge way a lot or beyond the minimum tariff and that is good because not only that pays revenue to the country but it also generates better experience for the tourist visiting Bhutan.
The fact is that unless someone has proof of undercutting, we cannot do anything. Our system is robust enough to prevent undercutting but for those who transgress, we need to catch them. For that there needs to be peer to peer oversight within the tourism industry so that they could report anybody who breaks the law, said the Lyonchhen.
So far only one case of undercutting has come to notice of TCB and TCB has investigated and established that they were undercutting and license has been cancelled, said the Lyonchhen.
Therefore we take it serious but we are not sure about the undercutting in reality because people talk about it and in reality we don’t share any solid concrete evidence based complaints. He said, even if you receive any complain without any evidence at least we can try to investigate on this.
Prime Minister said that the whole thing about undercutting being quote rampant need to be questioned because it is not the interest of the tour operators to undercut. It is their forgoing self.