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Hundreds of merchants in the retail, jewelry and
hotel industries next month will install high-tech
cash registers that automatically transmit sales
information to the Ministry of Revenue (MoR).
Revenue authorities and privates businesses are both
eager to have the machines, which are expected to
make accounting easier for merchants and tax
collection easier for the government.
In all, 338 businesses will start using the machines
as of January 10, 2008. Of the total number, 130 are
in the hotel industry, 96 are supermarkets, and 112
of them are jewellery shops, sources from the MoR
disclosed.
Speaking to Fortune, Amarech Bakalo, director
general of the Federal Inland Revenue Authority (FIRA),
explained that these shops were selected to
participate in this first phase of implementation
because of their vast volume of transactions.
The MoR programme to promote the use of the machines
follows a spate of tax evasion cases caused by the
new, more complicated procedures for reporting Value
Added Tax contributions. The Ethiopian government
last month pardoned 77 alleged and convicted tax
evaders who claimed that they failed to pay dues
from their businesses only by oversight and error,
and without intent.
The machines will eliminate such errors by having an
Information Transmitter Terminal, which works just
like a mobile phone, built into the cash register
that will wirelessly communicate with the computer
server at FIRA’s headquarters to transmit data on
transactions.
FIRA has established the technical specifications
required of the machine to ensure compatibility, and
will now allow companies interested to act as
distributor to import machines matching the criteria
from overseas. Still, to be an officially sanctioned
distributor, companies must first demonstrate the
capacity to maintain the equipment and must also set
aside one million Birr in a blocked account.
To date, Petram is the only company that has
fulfilled FIRA’s criteria and is thus the sole
importer and distributor of the machine, Amarech
said.
The coming few weeks will see the arrival of at
least 2,000 new cash machines from the Japanese
company, BMC.
In an effort to ensure speedy importation, the new
cash registration machines will be exempted from
duty, sources from the ministry revealed.
According to Melaku Fenta, minister of revenue, the
introduction of the cash registration device will be
a big benefit for tax payers handling commercial
activities. The machines will save time in
accounting and will also allow merchants to track
their profit and loss timely and efficiently, he
added. Above all, those companies installing the new
cash machines will be able to pay taxes responsibly,
Melaku emphasized.
For their part, the tax-paying companies such as
hotels and supermarkets are concerned that Petram
has been given exclusive privilege to import the
device.
Tsegaye Asfaw, general manager of Imperial Hotel, is
sold on the idea of adopting the new technology,
though he is of the opinion FIRA has not allowed
enough time for installation. Moreover, he said
there should be various suppliers of the cash
registration machines to provide competition and
fair rates, he said.
Moges Hailu, manager of Shi Solomon supermarket
chains, shares Tsegaye’s concern. He said that in a
fair business environment, the market should be open
for all those capable of importing these machines.
Amarech, however, was quick to respond to the
criticism by pointing out that FIRA will check the
price of the machine in other African countries to
make sure that Petram is delivering the product at a
reasonable price.
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