NBR plans online access to ECR, POS to prevent VAT evasion

The tax authority has decided to establish online network between electronic cash registers or similar devices and its server to prevent value-added tax evasion by traders by altering the sales records.
National Board of Revenue officials said the proposed system will help the VAT officials to crosscheck the transaction data of the shops and calculate VAT in real-time.
The initiative has been decided as a part of the planned introduction of online VAT payment system under the new VAT and Supplementary Duty Act-2012 scheduled to come into effect from July 1.
Under the plan, all the ECR or POS machines installed in shops will be connected with the Integrated VAT Administration system server at the NBR through an electronic chip to be installed in every ECR or POS.
VAT officials will get instant access to the sales information of the shops through the server.
‘The system will make the sales records of the businesses available in real-time in the NBR server, facilitating VAT officials to calculate the actual amount of VAT payable by the businesses,’ an NBR high official told New Age last week.
VAT officials will be able to detect any alteration or change in the transaction records registered in the ECR or POS by traders, he said.
The revenue board made the installation of ECR or POS at shops in 11 categories mandatory in 2009 to prevent evasion of paying
the VAT collected from the consumers by the shopkeepers.
The categories include hotels, restaurants, sweetmeat shops, departmental and general stores, jewellery, all shops at shopping malls in metropolitan areas, and medium and large wholesale and retail shops across the country.
Officials said traders would have to install ECR or POS machines having fiscal memory so that any data related to sales and VAT cannot be changed, edited or altered by the users.
There are allegations that traders make changes to transition records in ECR or POS without fiscal memory with a view to evade the VAT collected from the consumers, they said.
The planned online connection between the ECR and VAT online system will prevent such alterations and VAT evasions, they said.
All of the sales transactions, payments of VAT and submissions of VAT returns can be conducted online after enforcement of the new VAT law, they added.
According to the NBR statistics, the field-level VAT offices so far identified 11,005 shops eligible for using the technology, of which 8,559 shops were selected for installation of the system.
But till now, only 2,970 shops or 35 per cent of the selected shops have installed the technology.  There are 38,000 VAT-paying units in the sectors.
The NBR has taken various initiatives including smoothing the process of installation of ECR and organising ECR fairs to encourage traders to adopt the technology.

News Courtesy: www.newagebd.net