Automated sales suppression device
Encyclopedia
An automated sales suppression device or zapper is a software program that falsifies the electronic records of point of sale
(POS) systems for the purpose of tax evasion
.
Most jurisdictions levy a sales tax
or a value added tax
on commercial transactions such as sales in stores or food served in a restaurant. These transactions are now most often recorded by a POS system rather than a mechanical cash register
. The POS system records are generally not alterable by the operator and are used as the basis of tax assessments and audits by tax authorities.
Because POS systems are increasingly designed as general purpose computer
s (as of 2008, 85% worldwide were reported to run Microsoft Windows
), arbitrary software can be run on them. A "zapper" is a software program, often run untraceably from a USB flash drive
, that accesses the POS system records and allows the owner of a business to alter the records so as to make it credibly appear that fewer transactions have occurred than has actually been the case. This reduces the tax burden on the business, which is generally proportional to the volume of the transactions.
The use of zappers is illegal and may be subject to criminal penalties. However, according to a 2008 New York Times report, governments worldwide have yet to find effective means of prosecuting their use. A European Union
committee on cash register fraud has been established, and legislation mandating tamper-proof POS systems has been proposed in Germany
in 2008 and introduced in Quebec
on September 1st, 2010.
Point of sale
Point of sale or checkout is the location where a transaction occurs...
(POS) systems for the purpose of tax evasion
Tax evasion
Tax evasion is the general term for efforts by individuals, corporations, trusts and other entities to evade taxes by illegal means. Tax evasion usually entails taxpayers deliberately misrepresenting or concealing the true state of their affairs to the tax authorities to reduce their tax liability,...
.
Most jurisdictions levy a sales tax
Sales tax
A sales tax is a tax, usually paid by the consumer at the point of purchase, itemized separately from the base price, for certain goods and services. The tax amount is usually calculated by applying a percentage rate to the taxable price of a sale....
or a value added tax
Value added tax
A value added tax or value-added tax is a form of consumption tax. From the perspective of the buyer, it is a tax on the purchase price. From that of the seller, it is a tax only on the "value added" to a product, material or service, from an accounting point of view, by this stage of its...
on commercial transactions such as sales in stores or food served in a restaurant. These transactions are now most often recorded by a POS system rather than a mechanical cash register
Cash register
A cash register or till is a mechanical or electronic device for calculating and recording sales transactions, and an attached cash drawer for storing cash...
. The POS system records are generally not alterable by the operator and are used as the basis of tax assessments and audits by tax authorities.
Because POS systems are increasingly designed as general purpose computer
Computer
A computer is a programmable machine designed to sequentially and automatically carry out a sequence of arithmetic or logical operations. The particular sequence of operations can be changed readily, allowing the computer to solve more than one kind of problem...
s (as of 2008, 85% worldwide were reported to run Microsoft Windows
Microsoft Windows
Microsoft Windows is a series of operating systems produced by Microsoft.Microsoft introduced an operating environment named Windows on November 20, 1985 as an add-on to MS-DOS in response to the growing interest in graphical user interfaces . Microsoft Windows came to dominate the world's personal...
), arbitrary software can be run on them. A "zapper" is a software program, often run untraceably from a USB flash drive
USB flash drive
A flash drive is a data storage device that consists of flash memory with an integrated Universal Serial Bus interface. flash drives are typically removable and rewritable, and physically much smaller than a floppy disk. Most weigh less than 30 g...
, that accesses the POS system records and allows the owner of a business to alter the records so as to make it credibly appear that fewer transactions have occurred than has actually been the case. This reduces the tax burden on the business, which is generally proportional to the volume of the transactions.
The use of zappers is illegal and may be subject to criminal penalties. However, according to a 2008 New York Times report, governments worldwide have yet to find effective means of prosecuting their use. A European Union
European Union
The European Union is an economic and political union of 27 independent member states which are located primarily in Europe. The EU traces its origins from the European Coal and Steel Community and the European Economic Community , formed by six countries in 1958...
committee on cash register fraud has been established, and legislation mandating tamper-proof POS systems has been proposed in Germany
Germany
Germany , officially the Federal Republic of Germany , is a federal parliamentary republic in Europe. The country consists of 16 states while the capital and largest city is Berlin. Germany covers an area of 357,021 km2 and has a largely temperate seasonal climate...
in 2008 and introduced in Quebec
Quebec
Quebec or is a province in east-central Canada. It is the only Canadian province with a predominantly French-speaking population and the only one whose sole official language is French at the provincial level....
on September 1st, 2010.