politics
National Budget 2026–2027
Bhutan's FY 2026-27 budget — the first built on a full year of GST revenue — plans expenditure of Nu 135.5 billion against domestic revenue of about Nu 77 billion and external grants of Nu 30.7 billion, leaving a fiscal deficit of 6.5 per cent of GDP. Eight National Priority Programmes anchor the spending plan.
The National Budget for fiscal year 2026–2027 is the Royal Government of Bhutan's spending and revenue plan for the year from 1 July 2026, presented to Parliament in June 2026 and notified on 30 June 2026.[1][2] It is the first budget built on a full year of the Goods and Services Tax, and continues the 13th Five-Year Plan's investment push.
Total expenditure is estimated at Nu 135.5 billion (~USD 1.55 billion), with the overall appropriation — including repayments and lending — exceeding Nu 153 billion. The projected fiscal deficit is 6.5 per cent of GDP.[3][4]
Revenue
Domestic revenue is planned at just over Nu 77 billion (~USD 878 million), about Nu 7 billion — nearly 10 per cent — more than the previous year, with most of the increase from indirect taxes and non-tax revenue. The GST is projected to contribute Nu 14.18 billion in its first full year, roughly 47 per cent more than the sales tax it replaced; with excise, the goods-and-services category reaches Nu 16.9 billion. Direct taxes are expected to grow more slowly, reflecting the Income Tax Act 2025's cut of the corporate rate to 22 per cent and the removal of inter-company dividend taxation.[3]
On the non-tax side, the budget counts on higher dividends from Druk Holding and Investments as state enterprises in energy, finance and telecommunications improve, and on profit transfers from the 1,020-megawatt Punatsangchhu-II project at the new India-Bhutan export tariff of Nu 5.10 per unit. Customs collections are expected to grow with trade, alongside electricity-export royalties and tourism receipts through the Sustainable Development Fee.[3]
External grants are projected to rise 20.8 per cent, from Nu 25.4 billion to Nu 30.7 billion (~USD 350 million); India has allocated Rs 22.88 billion for the year.[3][5]
Priority programmes
Presenting the State of the Nation report on 18 June 2026, the Prime Minister framed the year around eight National Priority Programmes spanning economic transformation, social well-being and environmental resilience. Stated targets include mobilising Nu 3.5 billion in foreign direct investment, creating 25 startups and 100 new industries outside Thimphu and Chhukha, five new tourism packages with a Red Panda Flagship Programme, a 10 per cent rise in gypsum, dolomite and construction-material exports, 800 acres of agricultural land development, a USD 60 million digital-economy contribution to GDP, and employment programmes for 5,500 young people.[4]
See also
- National Budget 2025–2026
- National Budget 2024–2025
- 13th Five-Year Plan
- Goods and Services Tax (Bhutan)
- India–Bhutan economic relations
References
- Budget Report for FY 2026-27 — Ministry of Finance, Royal Government of Bhutan
- Budget Notification FY 2026-2027 (30 June 2026) — Ministry of Finance
- Domestic revenue expected to rise nearly 10% next fiscal year — BBS, 23 June 2026
- Eight priority programmes to drive economic transformation in 2026-27, says PM — BBS, June 2026
- India allocates Rs 22.88 billion grant to Bhutan for fiscal year 2026-27 — Bhutan Today
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