No effective initiative has been taken in the proposed national budget for 2024-25 fiscal year to stop gold smuggling, the country's jewellery makers and sellers said today.

The government should amend the baggage rule to stop illegal entry of gold and silver bars to the country, said the leaders of the Bangladesh Jewellers' Association (Bajus).

The smugglers are taking advantage of the baggage rule and bringing in gold bars, because of which money is being laundered and the local businesses are getting affected, they said.

Although the National Board of Revenue has repeatedly assured the jewellery makers to take into account their problems and demands in the pre-budget meetings, but there is no reflection of it in the proposed budget, said Anwar Hossain, chairman of Bajus standing committee on tariff and taxation.

Those who import gold bars and coins through legal channels will feel encouraged to make and export gold ornaments.

But, the burden of unequal duty rates has been imposed on the import of raw materials and machinery due to the indifference of the government departments concerned, he said.

The jewellery makers shared their observation on the proposed national budget for 2024-25 fiscal year, at a media briefing held in Bajus office in Dhaka today.

The jewellery industry in Bangladesh has apparently remained largely dependent on unauthorised channels for sourcing gold although there is no direct government bar on importing the precious metal.

Industry insiders said the high tax imposed on legally-imported gold is the main reason for the companies to feel more comfortable to source the precious metal from unauthorised channels.

Today, Bajus again proposed reducing the 5 percent VAT imposed on the sale of gold ornaments to 3 percent.

The VAT cut will encourage the buyers to purchase more gold, Anwar Hossain said.

The jewellery sector has the potential to generate Tk 1,000 crore revenue every year for the NBR, he said.