Go to contents

Cash Receipt System Boosting Some Businesses, Worrying Others

Cash Receipt System Boosting Some Businesses, Worrying Others

Posted June. 02, 2005 06:44,   


Distribution, Food, and Beverage Businesses are Polarized by Cash Receipt System-

The Starbucks Seoul Myeongdong branch, where four to five customers out of 10 pay in cash receipts, is benefiting from the cash receipt trend.

The Myeongdong branch manager explained, “With more customers looking for the bigger 5,000 won range coffees than the mid-sized 4,000 won coffees, the number of customers buying coffee over 5,000 won between January and May of this year, increased by seven percent compared to last year.”

Large discount stores are also expecting cash receipts to increase the number of their customers. An E-mart spokesperson said, “Just like when the expanded use of credit cards made customers flood into discount stores, the cash receipt system will also increase their numbers.” For discount stores, which often clash with credit card companies over service fees, the cash receipt system is a welcome system that saves them the 1.5 percent credit card service fees.

On the other hand, small stores that are reluctant to give receipts are concerned over the decrease in clients.

Mr. Han (52), who runs a supermarket in Eungam-dong, Eunpyeong-gu, Seoul said, “I am withholding from joining the cash receipt store association. But I’m worried because my customers are using convenience stores nearby and my sales have decreased.”

Some Stores Even Use Dual Prices-

“If you want a receipt, you have to pay 2.08 million won.”

That is what I heard at a computer store in Yongsan Electronics Mall on May 31. At first, the store clerk told me that the Samsung Sense Q30 notebook cost around 1.89 million won, but when I asked for a cash receipt, he suddenly demanded an additional 190,000 won, or 10 percent more than the original price. In other words, he wants the customer to pay for the taxes that will be charged when the amount of his sales are exposed.

Voluntary Participation with Tax Rate Reduction Should be Pursued-

Tax experts advise that for the cash receipt system to work, voluntary measures by business owners, rather than coercive measures, should be used.

Ajou University economics professor Hyun Jin-gwon pointed out, “The cash receipt system was introduced not to collect more taxes, but to promote the transparency of taxpayers. The rate of taxes such as business income taxes and value-added taxes that are set too high and that assume some level of tax evasion will occur, should be lowered to offer incentive for the voluntary adoption of the system.”