Govt won’t supply ECR to businesses

The government backtracked on its decision to supply Electronic Cash Register (ECR) to businesses to avert an after-sales obligation, officials said.

On an afterthought, the authorities found out that after-sales service would be required to operate the device for financial transaction by medium-scale businesses.

As per latest decision, the businesses will have to purchase the device of their own from importers to be selected by the government.

The importers will have to apply to the National Board of Revenue (NBR) for importing the computing machine following prescribed specifications from the Value Added Tax (VAT) wing.

Recently, the VAT Online Project (VOP) got approval from the Finance Minister in its summary for changing the methods of ECR supply.

Last year, the government had announced import of ECR on its own and supply to the businesses for the purpose of VAT collection in a new system.

Talking to the FE Monday, Deputy Director of the VOP Syed Mushfiqur Rahman said the process of ECR supply has been changed in view of the need for after-sale service to operate ECR.

"Businesses will have to purchase the device from our enlisted importers as a certain specification will be required to be connected with the VAT online system," he added.

Importers will have to provide after-sale service and keep spare parts of the machine available, he said.

Five years' experience as importer is a prerequisite for getting enlisted with the NBR to do the newfound job, he added. 

The enlisted importers can import duty-free ECR for supplying to the businesses at a reasonable price, he said.       

It would not be possible for the government to provide the after-sales service to the businesses for the ECR, Mr Rahman said.

Specifications of the ECR will be finalised within this week.

"We will purchase server and software for the systems by floating tender," he said.

The VOP authorities will float tender for selecting software companies within next two weeks, he added.

The government had planned to start to supply the ECR machine to the medium-scale businesses on July 1, 2017, concomitant with enforcement of the impugned new VAT law. 

Later, the process faced a setback due to changes in decision on ECR supply.

There will be two systems installed for large outlets like Agora, Aarong and medium-scale businesses.

Existing businesses that are using Point of Sale (PoS) and customized software in their large outlets will be able to use their own system by installing a new prescribed fiscal printer.

Other businesses, which are using outdated ECR device, have to purchase a new machine.

Real-time transaction could be tracked as it would be hooked up with the VAT system. VAT system would issue a code in the system that would be required to print the sales invoice. 

The VAT authority would organise lottery after two months on the codes to encourage consumers to take ECR-generated invoice. 

The NBR has made installation of ECR mandatory for 11 categories of business by 2019.

Hotels, restaurants, sweetmeat shops, departmental and general stores, jewellery, all shops at shopping malls in the metropolitan areas and, medium and large wholesale and retail shops across the country are under mandatory system to prevent evasion of VAT collected from consumers by the shopkeepers. In a study, the NBR found a total of 11,005 shops eligible for using the ECR.

It found some 3,000 shops or 35 per cent of the selected ones having installed the ECR machine or POS terminal until 2016.

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