Boards comparing the Gelephu Mindfulness City Special Administrative Region (GMC) with other centres need the same axes applied to each candidate. This page states GMC's position on each axis from the statute, with section references, and sets out the questions to put to any alternative. We do not state other jurisdictions' rules here; each should be verified against its own primary sources.
What this guide covers
Eleven axes, each with GMC's statutory answer and the question to ask elsewhere. "$" in GMC law means United States dollars.
| Axis | GMC's statutory position | Question to ask of any alternative |
|---|
| Constitutional basis | Created by Royal Charter No. 1 of 2024 as "a fully independent and autonomous region in the Kingdom of Bhutan" with executive, legislative and judicial authority including final adjudication (Art. 1); Charter amendable only by Royal Decree (Art. 7). | What instrument creates the zone, who can amend it, and does the zone's court have final say? |
| Governing law | The received common law and equity of established common law jurisdictions apply so far as suited to GMC, subject to GMC enactments (Application of Laws Act 2024, s. 3); the applied statutes in Schedule A and the applied financial services rules in Schedule B applied with modifications (ss. 4, 5). | Is the legal system codified or common law, and what is the source of gap-filling law? |
| Currency of account | Every "$" is a US dollar across the Companies Act (s. 4A), Income Tax Act (ss. 2AA, 62A), Employment Act (s. 2AA) and Foreign Workforce Act (s. 2AA). | In which currency must capital, payroll and tax computations be stated? |
| Corporate tax | 15% on every dollar of chargeable income of a company or body of persons (Income Tax Act 2025, s. 43(1)(a)). | What is the headline rate, and what is the effective rate after mandatory add-ons? |
| Personal tax | 0% for individuals who are not citizens of Bhutan, resident or not, on chargeable income derived on or before 31 December 2030 (s. 43(1)(ba)). | Is there personal income tax, for whom, and until when? |
| Incentives | Founders company exemption up to 15 years in total (s. 13Y(8)); strategic and development company rate of not less than 5% (s. 43D(1)); no approvals after 31 December 2030 (ss. 13Y(5), 43D(4)). | Are incentives statutory or discretionary, and is there a closing date? |
| Share disposal gains | Exempt for qualifying disposals of ordinary or preference shares held at 20% or more for at least 24 months (s. 13W(1A)). | Is there a capital gains tax, and what is the participation threshold? |
| Financial regulator | One regulator, GFSO, for all financial services and virtual assets; General Prohibition in Financial Services Act 2025, s. 16; virtual assets inside Schedule 1 (paras. 4, 43, 54) and a named fiat-referenced token activity (para. 53B). | Is crypto regulated under the primary financial statute or a separate regime, and by which body? |
| Substance | At least one director ordinarily resident in GMC, satisfied by a work visa or work pass (Companies Act 2025, s. 145(1), (1A)); a licensed body corporate's head office and registered office must be in GMC (GEN 4.5.1(1)). | What physical presence is required by company law, and what more by the regulator? |
| Entity mobility | Inward transfer of registration under Part 10A; registration "does not create a new legal entity" and preserves property, rights and obligations (s. 361(2)); tax provisions for redomiciled companies (Income Tax Act, ss. 34G, 34H). | Can an existing company migrate in and out with continuity of personality? |
| Contract law | Sale of Goods Act 2026 implied terms (ss. 12–15); Unfair Contract Terms Act 2026 reasonableness test (s. 11) and anti-avoidance choice-of-law rule (s. 27); both in force 15 June 2026. | What commercial contract statutes apply, and do they override a foreign governing law clause? |
The series articles
- GMC vs DIFC vs ADGM vs Singapore vs Labuan: A Comparative Table for Boards Choosing a Jurisdictionthe full board paper, with GMC's column sourced to statute.
- Is GMC a Separate Jurisdiction?the Charter and the meaning of autonomy.
- Which Law Applies in GMC?the Application of Laws Act 2024 in detail.
- The GMC Tax Regime in Fullrates and the 2030 windows.
- Redomiciliation to GMCmoving an existing company in.
- Dispute Resolution in GMCcourts, final adjudication, arbitration and enforcement.
Frequently asked questions
Is GMC a sovereign state for treaty purposes?
No. The Charter describes GMC as a region "in the Kingdom of Bhutan" (Art. 1). Treaty coverage is therefore a question of Bhutan's arrangements and how the Income Tax Act gives effect to them (s. 49). Our double taxation guide addresses this.
Is the 15% rate the whole corporate tax story?
It is the headline rate in s. 43(1)(a). Approved companies may pay less under s. 13Y or s. 43D, and withholding applies to specified payments to non-residents (ss. 45–45G).
How should we weight the 2030 dates?
As statutory facts. The 0% personal rate and both approval windows are tied to 31 December 2030 (ss. 43(1)(ba), 13Y(5), 43D(4)).
Can we keep our existing holding company and just add a GMC subsidiary?
Yes; that is ordinary incorporation under ss. 17 to 19 of the Companies Act 2025. Redomiciliation under Part 10A is the alternative where continuity of the existing entity matters.
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, Arts. 1, 7
- Application of Laws Act 2024, ss. 3, 4, 5
- Companies Act 2025, ss. 4A, 17–19, 145, 355–361
- Income Tax Act 2025, ss. 2AA, 13W, 13Y, 34G, 34H, 43(1)(a), 43(1)(ba), 43D, 45–45G, 49, 62A
- Financial Services Act 2025, s. 16; Schedule 1, paras. 4, 43, 53B, 54
- Employment Act 2025, s. 2AA; Employment of Foreign Workforce Act 2025, s. 2AA
- Sale of Goods Act 2026, ss. 12–15; Unfair Contract Terms Act 2026, ss. 11, 27
- GEN Rulebook 2026, 4.5
