Washington D.C. – National Conference of State Legislatures
Forty-six states and the District of Columbia levy a sales tax at the state and/or local level. A device called a “tax zapper,” however, may mean these jurisdictions are being short-changed. Automated sales suppression devices, or zappers, have proliferated with the computerization of cash registers and have given retailers the ability to cheat state and local tax departments out of owed sales taxes through the falsification of electronic records of point of sale (POS) systems (modern cash registers).
Zapper software is stored on a portable USB device that can quickly and easily be linked to the cash register system. At the end of the day, the software systematically modifies the machine’s records to reduce the value of the day’s sales. For instance, a $5 receipt may become $4.50 or a $3 purchase may be erased altogether. For every dollar in sales a store deletes from its records, the owner gets to keep the extra cents that would otherwise be sent to a state and local government as sales tax. While it’s only pennies at a time, after enough transactions, the money adds up.
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