New payment system to earn extra tax revenue

New payment system to earn extra tax revenue

ANKARA - Anadolu Agency
New payment system to earn extra tax revenue

The adooption of new devices will be mandatory for mobile POS machine using businesses as of July 1. ‘You will no longer see one cash register and three to five POS machines next to it,’ the developer of new devices says.

The integration of POS machines and cash registers in a system that will go online as of July 1 is predicted to earn extra tax income for the government, according to the manufacturer of the system, which is the only one of its kind in the world.

“Since all shopping transactions will be invoiced, it [the system] will provide 5 to 10 billion Turkish Liras of tax revenue for the government,” Murat Sancak, the board chairman of Turkey’s MT Group, the first licensed manufacturer of the new system.

The system, which is an essential part of Turkey’s “Action Plan of Strategy for the Fight against the Informal Economy,” enables transactions that used to be made through two different machines, POS (Point Of Sale) and cash register, to be done through a single device that gives single receipt.

“You will no longer see one cash register and three to five pos machines next to it,” Sancak said.

At the first stage that begins on July 1, the system will be used – mandatorily – by the restaurants and enterprises that utilize mobile pos machines in their daily business and the road-side parking companies.

Sancak said the other enterprises would be able use their cash registers until the end of 2015.
However, he said, if a register’s financial memory was filled as of Jan. 1 2014, a new generation cash register would be handed to them instead of providing a new memory.

He noted that the system was actually scheduled to be completed and go online as of Dec. 31, 2012, but implementation had been delayed as the sector components asked for it to do so.

The shift to a more integrated payment system is compliant with the government’s accelerated efforts to fill every possible gap in tax collection in a bid to raise public income that is one of the remedies for Turkey’s chronic current account gap.

In addition to ensuring all transactions will be registered, the new scheme also brings a tax income hike for government by 20 liras for every 1,000 liras worth of credit card spending.

The amount is determined by the Fight against the Informal Economy Coordination Committee.

MT group has a solution partnership with Turkey’s Denizbank so the business owners who choose to work with this lender will have some advantages, but Sancak said the integration process with other banks was ongoing and all owners of the new generation machine would be able choose any bank they wished.

“The rule makers used to be the banks in Turkey. In current situation, meanwhile, the tax payer will be the owner of the machine and will be able to work with whichever bank they want to work with,” Sancak said, adding the customer would be pleased as there would not be any problem about paying with a credit card.

Heating competition

MT group is the first company to earn a license to produce these integrated machines with its completely nationally developed and produced device called “Vera Delta.”

Sancak said MT had invested $40 million in the system which is the first of its kind in the world, adding the company was in talks with four European countries, Azerbaijan and Georgia over the sale of the system.

However, the magnitude of the industry potential has also drawn others’ interests to the matter, as with even at the first stage around 350,000 machines expected to be replaced.

Three technology companies Beko, Hugin and Profilo have completed their preparations to enter into the market with their own devices.

Therefore the involvement of new players into the sector brings a variety of advantages or campaigns for the business owners.