The National Board of Revenue (NBR) plans to install nearly 20,000 electronic fiscal devices (EFDs) in jewellery shops across the country to boost revenue collection from the sector.

As part of this nationwide initiative, the tax administration has initially selected 17 districts, including Narayanganj, Narsingdi, Munshiganj, Manikganj, Savar, Gazipur, Mymensingh, Netrokona, Kishoreganj, Sherpur, Tangail, Jamalpur, Chattogram, Cox's Bazar, Bandarban, Khagrachhari, and Rangamati.

According to NBR sources, the administration issued a letter to the leaders of the Bangladesh Jewellers Association (Bajus) and held a meeting with them to facilitate the process.

The NBR is scheduled to hold a virtual meeting with stakeholders on Thursday to raise awareness about the initiative.

Genex Infosys PLC Ltd has been assigned to install the EFDs, as stated in an official letter issued by the NBR.

This initiative comes at a time when the revenue board is struggling to meet its collection targets and has recorded a year-on-year decline in revenue.

During the first five months of the current fiscal year, the tax administration collected Tk 130,185 crore, marking a 2.62 percent decrease compared to the same period last year.

Additionally, on January 9, the NBR raised value-added tax (VAT) and supplementary duty (SD) on nearly 100 goods and services, despite concerns that the move could exacerbate inflation and slow economic activity.

The VAT and SD hike aligns with recommendations from the International Monetary Fund (IMF), which approved a $4.7 billion loan for Bangladesh in January last year.

The IMF advised that the government rationalise tax exemptions, improve compliance with tax laws, and implement reforms to strengthen domestic revenue collection in the country, which has one of the lowest tax-to-GDP ratios in the world.

The NBR's letter also requested a list of jewellery establishments located in various markets and areas under the jurisdiction of the Dhaka Commissionerate.

"If it is not possible to provide the complete list at once, it is requested to submit it in phases," the letter added.

Masudur Rahman, spokesperson for Bajus, told The Daily Star that in the first phase, EFDs will be installed across all jewellery shops in the Dhaka and Chattogram divisions.

The installation will continue in phases across the remaining divisions, he added.

Currently, the number of registered VAT payers in Bangladesh is just over 500,000, as a significant number of eligible businesses remain outside the system.

According to Bajus, many jewellery shops in the country do not have VAT registration. The government's revenue will increase if EFDs are set up across all establishments, as such shops would be required to register.

According to government estimates, the demand for gold in the country stands at roughly 20 to 40 tonnes per year.

The commerce ministry says almost 80 percent of the demand is met through smuggling. Bajus added that gold worth around Tk 73,000 crore is smuggled into the country each year.