The National Board of Revenue (NBR) in Bangladesh has announced plans to install electronic fiscal devices (EFDs) in jewellery shops across the country.
This initiative aims to enhance revenue collection in a sector where many businesses currently operate outside the Value Added Tax (VAT) system. The rollout will begin in 17 districts, with Dhaka and Chattogram as initial focal points.
Phased Implementation Across 17 Districts
The implementation will begin with EFD installations in jewellery shops across districts including Dhaka, Narayanganj, Chattogram, and Mymensingh. Genex Infosys PLC will oversee the installation. The initiative aligns with recommendations to improve tax compliance and revenue collection.
Addressing Challenges in the Sector
During a meeting on 7 January, the NBR and BAJUS addressed challenges facing the jewellery sector, such as VAT registration gaps, baggage rule complications, and gold import issues. Many jewellery shops are currently unregistered under the VAT system. The installation of EFDs will require businesses to register, ensuring wider compliance.
The NBR has scheduled a virtual meeting on 23 January with jewellery sector stakeholders. The session will address concerns and explain the next steps in the EFD implementation process.
Sector Context and Implications
Government estimates place the annual gold demand in Bangladesh between 20 and 40 tonnes, with nearly 80% of this demand met through smuggling. According to BAJUS, gold worth Tk 73,000 crore enters the country through illegal channels each year.
Implications for Jewellers
Jewellers should prepare for increased scrutiny and compliance requirements as the NBR expands its regulatory measures. Businesses operating outside the VAT system will need to register, and those already compliant may face additional procedural requirements. The initiative aims to bring more businesses into the formal economy, potentially reducing illegal trade.
