National Board of Revenue has made mandatory the use of electronic fiscal device for 13 categories of shops, instead of the existing electronic cash register machine.
Value-added tax wing of NBR on Thursday issued a general order in this connection saying that the order would take effective on November 1 for all city corporation areas and on December 1 for all district headquarters.
The categories of businesses include hotels, restaurants and fast food outlets, sweetmeat shops, furniture, clothing store or boutique shops, beauty parlours, electronic/electrical household sales store, community centre, department store, general store/super shops, jewellery and related shops, all shops at luxury shopping malls and other big and medium wholesale and retail shops located in all city corporation areas and district headquarters.
The businesses which will use their own point of sale (POS) software must have electronic fiscal printer (EFP) instead of EFD.
NBR has also set technical specifications and other features both for EFD and EFP.
NBR officials said that the device would be connected online with NBR server known as Electronic Fiscal Device Management System.
Every transaction to be made through the device will be transferred to the EFDMS for authorisation code and traders will be able to complete the transactions only after getting the code from the system, they said.
They said that the code with a unique identification number would appear on the printed sales invoice or VAT challan (fiscal receipt) as a proof of VAT payment.
The challan will contain the name and address of business, BIN, name of cashier and counter number, fiscal device and fiscal memory number, details of products or services with quantity, price, VAT rate, VAT amount and VAT included price, mode of payment (cash, card, cheque or credit), authorisation code, date and time, and barcode or QR code.
Every EFD or several EFD activated at a business premise will be registered against a unique business identification number
(BIN), known as VAT registration number.
As per specifications, EFD must have specific feature so that it can be interconnected with EFDMS of NBR through its application programming interface.
The EFD must have programming capacity to share transactions information with and receive authentication code for completion of transactions from the EFDMS.
Traders will not be able to print sales receipt or VAT challan with the authentication code received from the EFDMS.
The device must have option for connectivity with SIM (GPRS/3G/4G) in addition to wifi or fibre optic connectivity, and rechargeable battery or alternative power supply system to keep it always on.
It must have such feature so that NBR can make the device effective or dysfunctional electrically through remote control system and transaction records cannot be removed, erased or modified by anyone.
The device also must have systems to calculate VAT at different rates and to generate various types of reports and automatically send those to EFDMS.
Traders will have to preserve database and necessary documents for six years.
VAT officials will be able to inspect the business premises to check whether the EFD/EFP is running properly and accuracy of VAT returns in line with the information preserved in the devices.
According to the order, non-compliance with the order such as not using the devices is subject to punishment under VAT law.
NBR in 2009 first made use of conventional electronic cash register (ECR) mandatory for 11 categories of shops.
But it made a very little progress over the years as only around 3,000 shops installed the devices.
NBR now introduced the EFD scrapping ECR as VAT officials could not trace whether traders use the ECR, collect VAT from customers and deposit to the government exchequer.
EFD will address the problems as VAT officials will be able to monitor online the status of EFD whether it remains working or closed.