GERMANY: a bill to end manipulation with cash registers

November 19th, 2015: The German federal government has initiated a discussion panel for a bill which announces the end of tax evasion related to manipulation with cash registers (a.k.a. zappers and phantom-ware). “The federal government was not stimulated enough to hunt for manipulators, but now slowly it is getting there,” said NRW Finance Minister Norbert Walter-Borjans. Auditors can make unannounced visits to companies and look for hidden software which are reducing true turnover. If found, responsible person and the company will face heavy fines.

NRW has been calling for a long time for a cooperation of other federal states in adopting a law against tax evasion by electronic tills, where one can falsify the recording of revenue by zapping the totals. This can actually happen before the summer break in 2016. Many associations and trade unions have sent their appeals to the federal government against the introduction of these legal instruments. According to the local cash register vendor, their clients often decline to invest in a new POS system until the federal government comes up with a new legislation.

“Time is running out. Until tamperproof cash registers compulsory, the state year after year loses an estimated five to ten billion euro of taxpayers’ money, said Walter-Borjans in Dusseldorf and adds: “Experts believe this estimate is even conservative.”

What is not surprising is that inspectors report, from their daily activities, that cash registers often fail during inspections in the premises of taxpayers where sales suppression is most likely happening. Such failure causes total loss of the journal records. Sometimes records are missing for 50 percent of the revenue. “For the lost tax revenue, honest tax payers are paying high toll,” said the Minister.

In North Rhine-Westphalia since the spring time in 2014 the first tests with tamper-proof cash registers begun at two bakeries. The data that are generated are manipulation free and can be quickly and easily read by auditors. Initial results show that the tests are running smoothly and error-free.

“We will accompany the legislative process constructively. We will ensure that the law takes in consideration the cost for the user, which must be bearable, “said Walter-Borjans.

For more information, see www.fm.nrw.de.