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Does landholding need a cap?

12 February 2010

If the draft national land policy, which removes the maximum landholding ceil­ing of 25 acres, is adopted, it will widen the gap between the haves and have-nots, say most members of the public.

The draft policy says that the ceiling will be lifted to en­courage commercial farming and large-scale development with progressive taxation on large landholdings which may be exempted if actively used for food production. It says that there was no effec­tive mechanism to monitor and control landholdings as the ceiling was gung-based and land owners simply split their gung upon reaching the limit.

The tax amount will be decided in consultation with the Ministry of Finance, said an official from the National Land Commission (NLC).

A resident of Thimphu said that, with the removal of the ceiling, rich people will buy large plots of land and use them for commercial farming in order to avoid tax. This, he said, will deprive the farm­ers of their income from farm produce. Even if the land is not used for farming, paying taxes won’t be a problem for them, he added.

However, Secretary of NLC, Dasho Sangay Khandu, said that, if people acquired excessive land and used it for food production, there was no problem since the bottom line was increasing food pro­duction. “The land use should be controlled so that there is no speculation,” he said.

Some people say that the new land policy will spawn many industries creating job opportunities but giving the rich more influence. This will make the rich richer and the poor will remain poor, they say.

“The poor will continue to get suppressed by a richer few,” said an entrepreneur, adding that, if the policy gets through, the land price will shoot up overnight, which will stand against those who want to acquire a small plot.

A businessman in Thim­phu said the policy will en­able rich people to acquire unlimited land in the rural areas and use it for commer­cial farming. “Are we going the mercantilist way? What will happen to our farmers?” he asked.

Dasho Sangay Khandu said, “We have studied pros and cons before deciding on this. The land ceiling existed since 1976 but who was re­sponsible for its implemen­tation prior to the establish­ment of NLC?”

However, he said the poli­cy will be discussed with the stakeholders before it is ad­opted by the cabinet which is expected to take about a year or more.

An official from the com­mission said that land ceil­ing did not make any sense since families held more than 25 acres of land in the past. He, however, said that taking public opinions into consid­eration, the policy will be re-drafted.

The draft land policy says that, in order to support and encourage commercial agri­culture to supplement food production, enable food se­curity and to increase em­ployment opportunities in the rural areas, land will be provided where possible. The government will also provide subsidies and tax breaks for big agriculture farming proj­ects. It also says that conver­sion of non-productive and non-viable marginal wetland to other types of land will be simplified.

The policy liberalizes the plot size requirement for house construction. The Land Act prohibits subdivision of land below 10 decimals in rural and 13 decimals in ur­ban areas, which is the area required for construction of a house. But in reality, there are many parcels that do not meet the requirement.

The implementation of the land policy measures will largely be executed by the local authorities such as ge­wogs, dzongkhags, thromde administrations and other government agencies in line with the relevant acts, land related laws and local gov­ernment plans.

By Sonam Pelden

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