Raised Bill No. 5421
February Session, 2012
LCO No. 1956
Referred to Committee on Finance, Revenue and Bonding
AN ACT CONCERNING "ZAPPERS".
Be it enacted by the Senate and House of Representatives in General Assembly convened:
Section 1. Section 12-428 of the general statutes is repealed and the following is substituted in lieu thereof (Effective October 1, 2012):
[(1)] (a) Any person required under this chapter to pay any tax, or required under this chapter or by regulations thereunder to make a return, keep any record or supply any information, who wilfully fails to pay such tax, make such return, keep such records or supply such information, at the time required by law, shall, in addition to any other penalty provided by law, be fined not more than one thousand dollars or imprisoned not more than one year, or both. Notwithstanding the provisions of section 54-193, no person shall be prosecuted for a violation of the provisions of this subsection committed on or after July 1, 1997, except within three years next after such violation has been committed. As used in this section, "person" includes any officer or employee of a corporation, or a member or employee of a partnership under a duty to pay such tax, make such return, keep such records or supply such information.
[(2)] (b) Any person who wilfully delivers or discloses to the commissioner or his authorized agent any list, return, account, statement or other document, known by him to be fraudulent or false in any material matter, shall, in addition to any other penalty provided by law, be fined not more than five thousand dollars or imprisoned not more than five years nor less than one year or both. No person shall be charged with an offense under both subsections [(1) and (2)] (a) and (b) of this section in relation to the same tax period but such person may be charged and prosecuted for both such offenses upon the same information.
(c) (1) As used in this subsection:
(A) "Automated sales suppression device" or "zapper" means a software program, carried on a memory stick or removable compact disc, accessed through an Internet link or accessed through any other means, that falsifies the electronic records of electronic cash registers and other point-of-sale systems, including, but not limited to, transaction data and transaction reports.
(B) "Electronic cash register" means a device that keeps a register or supporting documents through the means of an electronic device or computer system designed to record transaction data for the purpose of computing, compiling or processing retail sales transaction data in whatever manner.
(C) "Phantom-ware" means a hidden, preinstalled or installed at a later time programming option embedded in the operating system of an electronic cash register or hardwired into the electronic cash register that may be used to create a virtual second till, or may eliminate or manipulate transaction records that may or may not be preserved in digital formats to represent the true or manipulated record of transactions in the electronic cash register.
(D) "Transaction data" means information that includes items purchased by a customer, the price for each item, a taxability determination for each item, a segregated tax amount for each of the taxed items, the amount of cash or credit tendered, the net amount returned to the customer in change, the date and time of the purchase, the name, address and identification number of the retailer, and the receipt or invoice number of the transaction.
(E) "Transaction report" means a report that includes, but need not be limited to, sales, taxes collected, media totals and discount voids at an electronic cash register that is printed on cash register tape at the end of a day or shift, or a report that documents every action at an electronic cash register that is stored electronically.
(2) It shall be unlawful to wilfully and knowingly sell, purchase, install, transfer or possess any automated sales suppression device or phantom-ware.
(3) Any person convicted of a violation of subdivision (2) of this subsection shall be fined not more than one hundred thousand dollars or imprisoned for not less than one or more than five years, or both.
(4) Any person violating subdivision (2) of this subsection shall be liable for all taxes, penalties and interest due to the state as the result of such violation, and shall forfeit all profits associated with the sale or use of an automated sales suppression device or phantom-ware.
(5) An automated sales suppression device or phantom-ware and any device containing such device or software shall be contraband, and shall be subject to confiscation by the Commissioner of Revenue Services.
[(3)] (d) Any person who knowingly violates any provision of this chapter for which no other penalty is provided [,] shall be fined not more than one thousand dollars or imprisoned not more than one year, or both, for each offense.
This act shall take effect as follows and shall amend the following sections:
October 1, 2012
Statement of Purpose:
To make it a felony to sell, purchase, install, transfer or possess an automated sales suppression device ("zapper") or phantom-ware that eliminates point-of-sale transactions randomly, and creates a shadow record of the sale, making it difficult to detect understated records of sales and sales tax liability.
[Proposed deletions are enclosed in brackets. Proposed additions are indicated by underline, except that when the entire text of a bill or resolution or a section of a bill or resolution is new, it is not underlined.]