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Gold import cost to drop under baggage rules

Gold import cost to drop under baggage rules

The government may relax the baggage rules from next fiscal year to facilitate travellers to bring in gold bars and jewellery through the formal channel as it looks to curb smuggling.

As per the plan, a passenger will get the scope to bring 234 grams of gold bars or bullions upon payment of Tk 2,000 for each 11.664 grams (one bhori or tola), down from Tk 3,000 this fiscal year, according to officials of the National Board of Revenue (NBR) and a representative of Bangladesh Jewellers Samity.

The move comes after the NBR last month offered jewellers and gold traders the opportunity to legalise their undeclared stock of gold and other precious metals at a fixed rate until June 30 this year.

Gold traders and goldsmiths will be able to legalise their undeclared and stocked gold by paying Tk 1,000 for each bhori of gold and gold ornaments.

For cut and polished diamonds, the rate will be Tk 6,000 for each carat. In case of silver, jewellers will have to pay Tk 50 a bhori, according to the NBR notification.

The tax authority granted the special privilege to gold traders and jewellers after the government framed gold policy in November last year to: make import and export of the precious metal easy, stop smuggling and ensure transparency in its trade.

The policy came in the face of demand from jewellers after Customs Intelligence and Investigation Directorate seized gold from Apan Jewellers for its failure to show valid documents for the precious metal.

Bangladesh’s annual demand for gold is between 20 and 40 tonnes and almost 80 percent of it is met with illegal imports as traders shy away from importing the metal owing to complexities in the procedure.

Like Apan, almost all jewellers have gold in stock that they cannot show in their income tax returns as they do not have a valid source of purchase of the metals, according to taxmen.

The special tax benefit has been awarded to give traders and jewellers the opening to legalise their holdings of gold and other precious metals.

To encourage jewellers to disclose their stock of gold and other metals, the NBR will also hold a three-day gold fair in all divisional cities beginning from June 23.

In Dhaka, the show is expected to take place at the InterContinental Hotel, said NBR member for tax policy, Kanon Kumar Roy.

Gold traders and jewellers will be encouraged to disclose their stock at the fair. Undisclosed gold of jewellers and traders would be illegal after the deadline of June 30, he added.

“Any possession of gold and other metals in excess of the declared amount would be illegal. We will impose penalty in addition to collecting the maximum amount of tax from the gold traders and jewellers,” he added.

Gold traders and jewellers will face the fate of Apan Jewellers unless they avail the opportunity to legalise their ‘black’ gold, said Dilip Kumar Agarwala, general secretary of the Bangladesh Jewellers Samity.

He expects the government to collect a handsome amount of tax from the sector as a result of the window.

The government’s move to facilitate import of gold through the formal channel and reduce duty under baggage rules would be helpful for the sector, he added.