Finance Minister AHM Mustafa Kamal on Tuesday urged revenue officials not to pressure taxpayers during tax collection.
He said individuals paying taxes should not face adverse effects during the revenue-mobilisation process.
During the inauguration of the electronic fiscal device management system (EFDMS) at the National Board of Revenue (NBR) for ensuring value-added tax collection from retail and wholesale businesses, he highlighted the inability of the manual system to guarantee tax compliance.
He expressed optimism that the EFDMS would help accelerate domestic revenue mobilisation.
The NBR organised the programme on its premises to hand over EFDMS installation and management to the publicly-listed private company Genex Infosys Limited.
At the programme, Finance Secretary Fatima Yasmin said the digital system would yield positive results and ensure proper value-added tax (VAT) deposits to the public exchequer.
She noted that the government relies on the NBR to fulfil its budget requirements.
Mahbubul Alam, president of the Federation of Bangladesh Chambers of Commerce and Industry (FBCCI), urged the NBR to ensure a harassment-free environment for businesses.
He requested the revenue board to conduct awareness campaigns and seminars to educate businesses about the benefits of EFDMS.
The FBCCI president said businesses already paying VAT are often pressed to pay more. Therefore, the scope of VAT collection should be expanded.
"VAT officials should avoid harassment when collecting VAT," he emphasised.
The FBCCI president also sought fund allocation from the Ministry of Finance to support innovative initiatives.
NBR Chairman Abu Hena Md Rahmatul Muneem said the digital transaction system through EFDMS would benefit both tax officials and businesses.
"VAT officials will have real-time transaction data, while business owners can monitor their inventory and sales," he explained.
Businesses that install the device will not be required to visit VAT offices monthly for return submission, as they can do it using the machine, he added.
He said there is no alternative to automation for effectively collecting VAT from retail and wholesale businesses. "Managing millions of retailers with limited manpower and technological knowledge is challenging. It is also not cost-effective."
He added the NBR has outsourced VAT collection by following the proper procedures of the Public Procurement Rules to select the company.
Initially, the company will install the device in greater Dhaka and Chattogram division; later, it will be expanded to growth centres by appointing more vendors, he said.
The NBR chairman said consumers must be aware of and retain their invoices after purchasing from EFDMS-installed shops.
Acting Managing Director and Chief Executive Officer (CEO) of Genex Shah Jalal Uddin said they have joined hands to cooperate with NBR in collecting due revenue, ensuring transparency.
"It's a new chapter in VAT collection under NBR," he commented.
There is limited scope for physical interaction between vendors and VAT payers to avoid potential allegations of harassment, he explained. "We will utilise Artificial Intelligence and Blockchain technology to provide VAT officials with instant live data."
"Our initial plan involves deploying 60,000 devices in Dhaka and Chattogram this fiscal year and then deploying 0.3 million EFDEMS machines over the next five years. This acceleration will further expedite the journey towards a Smart Bangladesh," he added.
Dr Moinul Khan, member of the VAT Implementation and IT Wing, said the NBR may consider offering instant cashback to consumers to encourage the use of EFDMS.
The VAT authority will attempt to devise mechanisms so that consumers prefer EFDMS-installed shops, he added.
The system has been seamlessly integrated into NBR's servers, allowing for direct oversight of VAT payments and collections, he stated.
During his speech, the finance minister was initially distracted by mosquitoes in the NBR conference room and apologised for momentarily forgetting his speech.
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