Summary
- A jurisdiction comparison is only as good as the accuracy of each cell. This guide gives GMC's position on every axis from the statute, and gives you the questions to ask about any competing centre. It does not state other jurisdictions' rules.
- Corporate tax: 15% on every dollar of a company's chargeable income (Income Tax Act 2025, s. 43(1)(a)). Personal tax for non-citizens: 0% on income derived on or before 31 December 2030 (s. 43(1)(ba)).
- Currency: every "$" in GMC legislation is the United States dollar (Companies Act 2025, s. 4A; Income Tax Act 2025, ss. 2AA, 62A).
- Regulator: a single regulator, the Gelephu Financial Services Office (GFSO), for financial services and virtual assets (Financial Services Act 2025, s. 1A).
- Judiciary: independent judicial authority with final adjudication at Charter level (Royal Charter No. 1 of 2024, Arts. 1 and 4); courts designated by the Druk Gyalpo.
- Entities: companies, LLPs, limited partnerships, partnerships, business names, investment trusts and funds; inward redomiciliation under Companies Act 2025, Part 10A (ss. 355–364A), with tax modifications in Income Tax Act 2025, ss. 34G–34H.
How to use this comparison
Boards choosing between financial centres usually build a table: rate, currency, regulator, courts, entity menu, redomiciliation, treaties. The table is useful only if every entry is sourced. This guide fills in GMC's column from the primary legislation and leaves the other columns to you, with a note on what to ask.
Axis 1: corporate income tax
GMC position. Tax is levied on the chargeable income of "every company or body of persons, tax at the rate of 15% on every dollar of the chargeable income thereof" (Income Tax Act 2025, s. 43(1)(a)). Non-resident persons other than individuals, trustees and executors are also at 15% (s. 43(1)(c)). The first year of assessment is the twelve months commencing 1 January 2026 (s. 2, "year of assessment").
Two statutory concessions sit beneath the headline rate, both with a closing window:
- Founders company (s. 13Y). Income of an approved founders company from a qualifying business in a "founders industry" is exempt from tax, subject to prescribed conditions. A founders industry is one not carried on in GMC on a scale adequate to GMC's economic needs and with favourable prospects (s. 13Y(2)). No company may be approved after 31 December 2030 (s. 13Y(5)); the total exemption period including extensions is capped at 15 years (s. 13Y(8)).
- Strategic and development company (s. 43D). The designated officer may approve a company for a concessionary rate "of not less than 5%" on income from a specified trade or business, subject to conditions. No approval may be granted after 31 December 2030 (s. 43D(4)).
Gains or profits from the disposal of ordinary or preference shares are dealt with by an exemption in s. 13W. Further concessions are available, for example the Finance and Treasury Centre rate in s. 43E and the fund exemptions in ss. 13O, 13OA and 13U.
Questions to ask of the alternative. What is the headline rate and base? Are concessions statutory or discretionary, and is there a sunset? How are share disposals treated?
Axis 2: personal income tax
GMC position. An individual who is not a citizen of the Kingdom of Bhutan, "whether resident in GMC or not", pays tax at 0% on chargeable income derived on or before 31 December 2030 (s. 43(1)(ba)). A Bhutanese citizen not resident in GMC is also at 0% to that date (s. 43(1)(b)). Bhutanese citizens resident in GMC pay progressive rates under s. 42 and Table 3 of Part A of the Second Schedule: nil on the first $10,000, then 5%, 7%, 9%, 11% and 13% on successive bands, and 15% above $500,000.
The 0% rate is time-limited on the face of the statute.
Questions to ask. Is the personal rate zero by statute or by absence of a tax? Does a residency test change the rate? What social contributions apply?
Axis 3: currency
GMC position. GMC legislates in United States dollars. The Companies Act 2025 provides that all references to "$" or "S$" are read as references to the United States dollar (s. 4A). The Income Tax Act 2025 reads every dollar reference as the US dollar (s. 2AA) and requires tax computations to be denominated in US dollars (s. 62A), with a functional-currency route in s. 62B. The employment, customs, LLP, limited partnership and business names Acts all carry the same rule. (See our guide to the dollar jurisdiction.)
The Royal Charter directs the GMCA to establish a central bank (Art. 4).
Questions to ask. What is the currency of account for tax filings? Is share capital denominated in a local currency by default? Are there exchange controls?
Axis 4: the regulator
GMC position. GMC has a single regulator for all financial services. The Financial Services Act 2025 vests regulatory functions in "the Regulator", defined as the Gelephu Financial Services Office (GFSO), and lists its objectives, including financial stability, integrity of the GMC financial system and protection of users (s. 1A(3)). The GFSO page describes it as the independent regulator of all financial services and virtual assets activities in GMC, so virtual asset firms are licensed under the same framework, with a Virtual Asset Guidance overlay.
The General Prohibition in s. 16 provides that no person may carry on a Regulated Activity by way of business in GMC unless a Licensed Firm or an Exempt Firm. Schedule 1 lists the Regulated Activities, including a named stablecoin activity, Issuing a Fiat-Referenced Token (para. 53B).
The application process published by the Gelephu Financial Services Office runs from initial meeting to In-Principle Approval with preconditions, then licence. Fees and minimum capital are set by GFSO and the Prudential rulebook, not on the face of the Act.
Questions to ask. Is there one regulator or several? Is crypto regulated under the main financial services statute or a separate regime? Does the primary statute name a stablecoin activity?
Axis 5: the judiciary
GMC position. Royal Charter No. 1 of 2024 gives GMC independent judicial authority "including final adjudication" (Art. 1) and directs the GMCA to establish an independent judiciary and a legal system based on common law principles (Art. 4). The commercial Acts each define "court" as the judicial body the Druk Gyalpo designates for the purpose. The common law and equity of established common law jurisdictions apply under s. 3 of the Application of Laws Act 2024, and the applied general law is presumptive for civil and commercial matters under s. 7. Until separate executive and judicial bodies exist, the GMCA administers and enforces the law (s. 11).
The framework is common law and independent by design; the court structure is settled by designation, and GMC courts can rely on common law precedents from any common law jurisdiction, so parties have a settled body of case law from the day the jurisdiction opened. (See our guide to whether GMC is a separate jurisdiction.)
Questions to ask. Is the court system common law? Is there a track record of commercial judgments and a final appellate body within the centre?
Axis 6: entity types and substance
GMC position. The menu of vehicles is complete for most business models. Companies limited by shares, by guarantee or unlimited (Companies Act 2025, s. 17(2)), private or public; foreign company branch registration (Part 11, Division 2); limited liability partnerships (LLP Act 2026); limited partnerships (Limited Partnerships Act 2026); general partnerships (Partnership Act 2026); sole proprietors and firms under the Business Names Registration Act 2026; investment trusts and collective investment funds under Part 11 of the Financial Services Act 2025; and protected and incorporated cell companies for insurers with GFSO consent (GEN Rulebook 2026, rule 8.9). (See our guide to every entity you can form in GMC.)
Substance is light on the face of the Companies Act and heavier in the tax incentives. A company needs at least one member (s. 20A), at least one director ordinarily resident in GMC, meaning resident or holding a valid work visa or work pass (s. 145(1), (1A)), a secretary resident in GMC unless waived (s. 171(1), (1AAA)) and a registered office in GMC (s. 142). Shares have no par value (s. 62A) and the Act does not prescribe a minimum paid-up capital. Licensed Firms must have their head office and registered office in GMC (GEN 4.5.1). The register of controllers is not open to the public (s. 386AF(11)).
Questions to ask. Is a resident director required? Is there a minimum capital? Is the register of beneficial owners public?
Axis 7: redomiciliation
GMC position. Inward transfer of registration is available for any body corporate incorporated outside GMC that intends to be registered as a company limited by shares (Companies Act 2025, ss. 355–356). The applicant reserves a name (s. 357), applies with a certified copy of its existing constitution, the proposed GMC constitution and the prescribed fee (s. 358), and on registration receives a notice of transfer of registration (s. 359(3)). Registration does not create a new legal entity or affect the company's property, rights, obligations or pending proceedings (s. 361(2)). Evidence of deregistration in the place of incorporation must be filed within 60 days, extendable (s. 359(6)–(7)).
The Income Tax Act 2025 modifies the tax treatment of redomiciled companies (s. 34G) and allows tax credits for approved redomiciled companies against home-jurisdiction tax on the same income (s. 34H). (See our guide to redomiciliation to GMC.)
Questions to ask. Does the alternative permit continuation in and out, with statutory continuity of legal personality and tax relief on entry?
Axis 8: treaties and exchange of information
GMC position. The Income Tax Act 2025 gives the designated officer power to declare double taxation arrangements with governments "outside GMC" to have effect (s. 49), with tax credits under s. 50 and pooling under s. 50C. Part 20A (ss. 105A–105H) implements exchange of information under such arrangements. Part 20B (ss. 105I–105Q) allows international tax compliance agreements to be declared, expressly including a FATCA agreement with the United States, competent authority agreements for automatic exchange, country-by-country reporting agreements and crypto-asset reporting framework agreements (s. 105K). Transfer pricing rules (ss. 34D–34F), a general anti-avoidance rule (s. 33) and a surcharge (s. 33A) are in force.
Treaty access follows from a specific order under s. 49. (See our guide to double taxation relief.)
Questions to ask. Which treaties are in force and do they cover the relevant counterparties? Are substance requirements tied to treaty access?
Where GMC is strong
Strengths on the statute. A 15% corporate rate with statutory concessions down to 5% and to full exemption; 0% personal tax for non-citizens to 2030; USD as the legislated currency; one regulator for finance and virtual assets under a single Act; a full entity menu; statutory inward redomiciliation with tax relief; a non-public register of controllers.
The 2025 Acts are deemed to have commenced on 26 December 2024 and the first year of assessment is 2026.
Practical checklist / Next steps
- Build your comparison table with a source column. For GMC, use the section numbers in this guide.
- Weight the axes by what matters most to your business.
- Test the tax case against the 31 December 2030 windows in ss. 13Y, 43D and 43(1)(ba).
- If a licence is needed, open the GFSO conversation early; the licence follows In-Principle Approval and satisfaction of conditions.
- If moving an existing company, model the Part 10A transfer and the s. 34G–34H tax position.
- Ask Basnet Law to confirm current fees, capital and treaty orders before the board paper is finalised; these are the items the statutes leave to regulations.
Frequently asked questions
What is the corporate tax rate in GMC?
15% on every dollar of chargeable income for companies and bodies of persons (Income Tax Act 2025, s. 43(1)(a)). Approved strategic and development companies may be taxed at a concessionary rate of not less than 5% (s. 43D), and approved founders companies may be exempt for up to 15 years (s. 13Y). Both approvals close after 31 December 2030.
Is there personal income tax in GMC?
For non-Bhutanese individuals, the rate is 0% on chargeable income derived on or before 31 December 2030, whether or not they are resident in GMC (s. 43(1)(ba)). Bhutanese citizens resident in GMC pay progressive rates from nil on the first $10,000 to 15% above $500,000 (s. 42 and Second Schedule).
Who regulates financial services and crypto in GMC?
The Gelephu Financial Services Office (GFSO), defined as "the Regulator" in the Financial Services Act 2025. Virtual asset activities are licensed under the same Act and Schedule 1, with Virtual Asset Guidance issued by GFSO.
Can a foreign company move to GMC?
Yes. Part 10A of the Companies Act 2025 allows a foreign corporate entity to transfer its registration to GMC as a company limited by shares without creating a new legal entity (s. 361(2)). Sections 34G and 34H of the Income Tax Act 2025 set the tax treatment.
Key takeaways
- GMC's column in any jurisdiction table can be filled entirely from statute: 15% corporate, 0% personal for non-citizens to 2030, USD, one regulator, common law, full entity menu, statutory redomiciliation.
- The two statutory tax windows close on 31 December 2030; planning should start from that date.
- Compare by asking the same sourced questions of each alternative rather than relying on second-hand summaries.
This article is general information about the law of the Gelephu Mindfulness City Special Administrative Region as at the date above. It is not legal advice and does not create a lawyer–client relationship.
You may contact Basnet Law at basnet@basnetgmc.com or office@basnetgmc.com for any legal queries related to GMC.
References
- Royal Charter No. 1 of 2024 (GMC), Arts. 1, 4
- Application of Laws Act 2024, ss. 3, 7, 11
- Income Tax Act 2025, ss. 1(3), 2, 2AA, 13O, 13OA, 13U, 13W, 13Y, 33, 33A, 34D–34F, 34G, 34H, 42, 43(1), 43D, 43E, 49, 50, 50C, 62A, 62B, 105A–105H, 105I–105Q; Second Schedule, Part A, Table 3
- Companies Act 2025, ss. 4A, 17, 20A, 62A, 142, 145, 171, 355–361, 364A, 386AF
- Financial Services Act 2025, ss. 1A, 16; Schedule 1, para. 53B; Part 11
- Employment Act 2025, s. 2AA; Employment of Foreign Workforce Act 2025, s. 2AA; Customs Act 2025, s. 3A; LLP Act 2026, s. 2A; Limited Partnerships Act 2026, s. 2A; Business Names Registration Act 2026, s. 2A
- GEN Rulebook 2026, rules 4.5.1, 8.9
