Govt. asks ACC probe in fis­cal in­cen­tive case

Business Bhutan - - Front Page - Pema Sel­don from Thim­phu

The gov­ern­ment has asked the Anti-Cor­rup­tion Com­mis­sion (ACC) for probe in a con­flict-ofin­ter­est case on Thurs­day in­volv­ing for­mer works and hu­man set­tle­ment min­is­ter Yeshey Zimba in re­la­tion to fis­cal in­cen­tives that the pre­vi­ous gov­ern­ment (Druk Phuen­sum Tshogpa) had granted.

Ac­cord­ing to the press re­lease is­sued from the Prime Min­is­ter’s Of­fice yes­ter­day, the present gov­ern­ment is of the view that there were el­e­ments of pol­icy cor­rup­tion, abuse of of­fi­cial power and func­tions, fail­ure to de­clare ob­vi­ous con­flict

of in­ter­est and of­fi­cial mis­con­ducts in­volved in grant­ing the ad­di­tional fis­cal in­cen­tive by the pre­vi­ous gov­ern­ment.

The press re­lease states that Ly­onpo Yeshey Zimba, be­ing one of the Cab­i­net Min­is­ters, had will­fully failed to de­clare con­flict of in­ter­est as re­quired by law and has ap­par­ently com­mit­ted of­fi­cial mis­con­duct in lead­ing the de­ci­sion mak­ing process that has hugely ben­e­fited his fam­ily mem­ber.

It is stated that the for­mer min­is­ter was a mem­ber of the Lhengye Zhungt­sog and of­ten of­fi­ci­ated for the Prime Min­is­ter in his ab­sence. The for­mer MoWHS min­is­ter had re­port­edly also chaired the 156th Ses­sion of the Lhengye Zhungt­sog when the for­mer Ly­onch­hen was ab­sent and the ad­di­tional fis­cal in­cen­tive was ap­proved.

The gov­ern­ment stated that ap­prov­ing the ad­di­tional fis­cal in­cen­tive was timed when an FDI in­cor­po­rated ho­tel ven­ture in Thim­phu town called M/s Bhutan Ho­tel Ltd. (now op­er­ated as Le Meri­dien), owned (part­nered) by Ly­onpo Yeshey Zimba’s daugh­ter, was un­der ac­tive con­struc­tion.

“Hence, Yeshey Zimba had not only failed will­fully to ‘De­clare Con­flict of In­ter­est’ as re­quired by law but had even chaired the very 156th Lhengye Zhungt­sog which al­lowed him to ex­er­cise edge over other mem­bers in lead­ing to­wards the ap­proval of ad­di­tional fis­cal in­cen­tives,” stated the press re­lease.

The gov­ern­ment also main­tained that the dec­la­ra­tion of the ad­di­tional fis­cal in­cen­tive was not only timed to by­pass re­port­ing re­quire­ment to Par­lia­ment, but was also well syn­chro­nized to gain op­ti­mum ben­e­fit by M/s Bhutan Ho­tel Ltd. (Le Meri­dien) as its ten­ure from April 2013 to De­cem­ber 2015 was seem­ingly de­signed for the ben­e­fit of ho­tels ready­ing to ac­quire those tax ex­empted items.

“Hence, be­sides of­fer­ing op­ti­mal ben­e­fit to M/s Bhutan Ho­tel Ltd. (Le Meri­dien), the ad­di­tional fis­cal in­cen­tive was nei­ther tar­geted to at­tract more in­vest­ments in the area of do­mes­tic or FDI ho­tel con­struc­tions, nor did it of­fer ben­e­fit to the ho­tels that were at the verge of com­mis­sion­ing their op­er­a­tions,” stated the me­dia re­lease.

The gov­ern­ment also main­tained that M/s Bhutan Ho­tel Ltd. (Le Meri­dien) alone had ben­e­fited by Nu.76,887,635 from the ad­di­tional in­cen­tives as shown by of­fi­cial records. “Hence, out of 92 ho­tels, M/s Bhutan Ho­tel Ltd. (Le Meri­dien) alone had ben­e­fit­ted by 41.20% of the to­tal tax ex­emp­tion amount. The se­quence of events thus com­pels this gov­ern­ment to view Ly­onpo Yeshey Zimba as hav­ing acted on vested in­ter­est,” states the press re­lease.

Be­sides be­ing a se­ri­ous pol­icy cor­rup­tion to use of­fi­cial pow­ers to fa­vor his own fam­ily mem­ber, it is also stated that Ly­onpo Yeshey Zimba’s con­ducts clearly tan­ta­mount to com­mis­sion of out­right cor­rup­tion if he is also found to have per­sonal own­er­ship in­ter­est in the above ho­tel ven­ture.

“Hence, if those al­le­ga­tions were ad­ju­di­cated to have been com­mit­ted by Ly­onpo Yeshey Zimba, the ill­got­ten gains too must right­fully be resti­tuted to the state as per law,” states the me­dia re­lease.

In ad­di­tion to ex­ist­ing fis­cal in­cen­tives that were in force since 2010, the press re­lease also stated that the DPT gov­ern­ment had ap­proved an ad­di­tional fis­cal in­cen­tive ti­tled as “Re­vised List of In­cen­tives for Tourist Stan­dard Ho­tels-April 2013” at its 156th Ses­sion of the Lhengye Zhungt­shog with en­force­ment ten­ure till 31st De­cem­ber 2015.

“There was no Par­lia­ment to be re­ported to by then and, just three days be­fore the Gov­ern­ment was dis­solved on 20th April 2013, the newly de­vised ad­di­tional fis­cal in­cen­tive was de­clared on 17th of April 2013 for its en­force­ment,” states the me­dia re­lease.

Mean­while, for­mer min­is­ter Yeshey Zimba could not be con­tacted de­spite nu­mer­ous at­tempts.

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