BB, NBR start executing electronic import LCs

Bangladesh Bank (BB) and National Board of Revenue (NBR) have established an integrated automated system to check capital flight and tax evasion through strengthening monitoring and supervision on foreign trade.

Both the government agencies started implementation of electronic letters of credit (LCs) for imports initially on Monday to facilitate the country’s overall foreign trade.

Under the system, BB is providing information on LCs to NBR, using its foreign-exchange transactions and monitoring system, generally known as ‘dashboard’.

The automated integrated system was run at Kamalpur ICD (Inland Container Depot) in the capital successfully on the day, a senior official, familiar with implementation of the system, told the FE.

He also said the system will be implemented at all customs stations within February 5.

C&F (clearing and forwarding) agents, as representatives of importers, are allowed to receive their goods after clearing duties and taxes through ‘e-payment’.

The C&F agents will be able to self assess their duties and taxes using ASYCUDA World system of NBR. Customs officials are empowered to reassess the duties and taxes, if necessary.

The system was introduced on January 25, but it could not operate properly due to technical problems, the official added.

“We’re working to introduce such an integrated automated system for exporters within a week,” BB deputy governor Nazneen Sultana told the FE Monday.

She said the system will help to prevent both money laundering and tax evasion through curbing fake documentation along with other loopholes, reports Financial Express.

The BB deputy governor also said the central bank is now monitoring all kinds of foreign-exchange transactions using the ‘dashboard’ to check fraud and forgery in the country’s banking sector.

On February 12, 2013, the central bank launched the ‘dashboard’ for monitoring all kinds of foreign exchange transactions. It provides summary of export, import, inland back-to-back LC, and inward and outward remittances separately.

BB’s latest moves came against the backdrop of a rising trend in illicit money outflows from the country, as reported by Global Financial Integrity (GFI). The Washington-based organisation was formed in 2006 to analyse unrecorded money disappearing out of the developing countries.

Its latest findings show that ‘illicit financial outflows’ from Bangladesh averaged, on an annual basis, at $1.3 billion between 2003 and 2012.

Besides, the central bank, the revenue board and Anti-Corruption Commission (ACC) are now working jointly to check illegal fund transfer.

“The central bank has already signed a deal with ACC for sharing information on money laundering between the two agencies,” another BB official said.