Electronic fiscal device: 60,000 to be installed in Dhaka, Ctg this FY

The National Board of Revenue (NBR), in association with Genex Infosys Limited, will install electronic fiscal devices (EFDs) at retail and wholesale outlets in Bangladesh to improve the collection of value-added tax (VAT) from these sources.

Initially, 60,000 EFDs will be deployed at stores in Dhaka and Chattogram within the current fiscal year while another three lakh devices will be installed all over the country within the next five.

"The adoption of EFDs will encompass all echelons of society and spur progress," said Finance Minister AHM Mustafa Kamal.

"Our objective is to expand this initiative nationwide through collaborative efforts between the NBR and Genex Infosys," he added.

Kamal yesterday made these comments while officially launching the EFD installation project at the NBR office in Agargaon, Dhaka.

He said the government's focus on transparency in the VAT system underscores its dedication to the nation's development, with VAT contributions representing all segments of society.

"We are resolute in enhancing transparency in this crucial domain. The NBR's strides in digitisation are commendable, and the symbiotic partnership between the government and private sector is truly laudable. We extend our gratitude towards Genex Infosys," he said.

Kamal added that this initiative marks a significant stride towards transforming "Digital Bangladesh" into "Smart Bangladesh".

According to the NBR official, the government will pay Genex Infosys about Tk 0.52 as commission for each Tk 100 transaction through the EFDs.

In August 2020, the revenue authorities launched EFDs on an experimental basis through five VAT offices in Dhaka and Chattogram, where 10,000 EFDs were installed at various stores.

However, the programme is yet to gain momentum. Explaining the reason for this, the finance minister said the initiative may have been delayed a little due to Covid-19, but it is now gaining speed.

NBR Chairman Abu Hena Md Rahmatul Muneem said EFDs herald an advanced era of VAT collection and enhanced management.

The devices will play a pivotal role in establishing a disciplined VAT framework by introducing digitised VAT collection mechanisms across diverse business domains.

The NBR envisions that this infrastructure will pave the way for digitised VAT management, solidifying Bangladesh's position as a globally recognised smart VAT-adopting nation.

"In this context, the evolution of VAT and tax payment systems is not just an option; it is an imperative," he added.

Shahjalal Uddin, chief executive officer of Genex Infosys, said the digital transformation of VAT management will not only boost government revenue, but also propel the nation towards heightened economic prosperity.

He said EFDs are poised to enhance productivity and ensure meticulous accounting practices within businesses. By simplifying the complexities associated with VAT payments and return filings, it will catalyse substantial progress for business owners.

Notably, VAT currently accounts for nearly 40 percent of the country's total revenue.

The EFDs implementation mandate encompasses 25 sectors, including departmental stores, wholesalers, and hospitality establishments.