Quebec Zaps Operators For Tax Fraud

Last week, Quebec restaurant operators turned on a new piece of equipment: government-mandated devices aimed at preventing the use of zappers, or software that enables illegal cash-skimming at the point of sale to reduce the sales amounts on official records.

The sales-recording devices, connected to a cash register or POS system, provide receipts with a bar code that can be scanned by Revenue Quebec, the province’s taxing authority.

The controversial anti-fraud requirement singles out foodservice operators but exempts other retail businesses–including bars and hair salons. A spokesman for the association representing Quebec restaurateurs told The Montreal Gazette that it’s unfair that other retail businesses are exempt from the regulations.

According to the Gazette, the most serious offenders tend to be restaurant owners, who can hide tax fraud by manipulating inventory levels.

Although Canadian taxing authorities say there is widespread zapper use across the country, Quebec is the only jurisdiction to mandate the equipment. The provincial government has set up a taxpayer-funded subsidy program to offset some of the equipment cost for restaurant owners.

Restaurants that have failed to buy, install and activate the equipment could face six-figure fines and up to six months in jail. The Gazette estimated that a third of Quebec restaurant owners have yet to comply with the rules.