NBR to import ECRs for VAT-evading businesses

The National Board of Revenue (NBR) will import 10,000 electronic cash register (ECR) machines for installing in small and big businesses under a project meant for plugging tax evasion.  
Officials said the digital cash registers will be supplied to the businesses at cost price to help them comply with government order on mandatory installation of the machine.
The board has taken the move following instructions from Finance Minister AMA Muhith. It will import the machines under tax-and duty-free facility.
"Installation of ECR machine should be made mandatory by some rules. The machines will be sold to the businesses currently paying VAT," the finance minister wrote in a note to the NBR.
He also directed bringing more businesses under the purview of mandatory installation of ECR.   
Initially, the revenue board has found some 8,007 businesses that are eligible for installation of ECR in their outlets.
Officials said the businesses that have already installed ECR and POS (point of sale) can get their machine customised with the NBR systems. In case of failure in customising the system, the businesses will have to buy the ECR machine from the government.    
The NBR has sought Tk 200 million from the Ministry of Finance (MoF) to import the register.
All of the ECR machines will be interconnected with the Integrated VAT Administration System (IVAS).
In the budget speech for the current fiscal year (FY), the finance minister had said the government was considering procuring the ECR machines and selling at cost price to popularise its use.
To materialise the plan, the NBR recently sent a proposal to the finance minister for his consent to import of the machines and allocating funds for the import.
Earlier, the NBR sent letters to all of the field-level VAT offices across the country to find out actual number of businesses eligible for installation of ECR machine.
There will be NBR-prescribed specifications, fiscal memory and security in those ECR machines, priced maximum Tk 20,000 to 25,000 each.
Although the NBR found the selected number of businesses insignificant for installation of ECR in respect of the number of shops in the country but decided to start the process as a first step toward ensuring compliance.
All of the maintenance work, account keeping and monitoring of the ECR machines will be done under the VAT online project.
Officials said the ECR machine will be interlinked with the VAT online system to crosscheck transaction data for preventing tax evasion.
As per the NBR guidelines, some 11 categories of shops have to install ECR mandatorily to keep all transaction and sales data.
The revenue board by an order in 2009 made mandatory the installation of ECR machine or POS terminal at small and medium shops to prevent evasion of VAT collected from consumers by the shopkeepers.
The categories include hotels, restaurants, sweetmeat shops, departmental and general stores, jewelry, all shops at shopping malls in the metropolitan areas and, medium and large wholesale and retail shops across the country.
Federation of Bangladesh Chambers of Commerce and Industry (FBCCI) adviser Manzur Ahmed welcomed the government decision to import and supply ECR to the businesses.
"We are yet to receive any offer from the government on ECR," he said.
The FBCCI adviser said the government should supply the ECR at subsidised price or for free to the businesses.
He, however, said in the open market economy, there is no necessity of supplying the ECR to the businesses. "We can purchase the machine from the market through verifying its price."
    doulot_akter@yahoo.com