Research Reveals Indirect Tax Compliance a Top Concern with Marketplace Operators and Sellers Looking to Keep Operational Challenges at a Minimum with Growing Demand for Cross-Border Sales
24 Mayo 2023 - 7:00AM
Research Reveals Indirect Tax Compliance a Top Concern with
Marketplace Operators and Sellers Looking to Keep Operational
Challenges at a Minimum with Growing Demand for Cross-Border
Sales
Increasingly, businesses are turning to marketplaces to sell
products and services online, with three out of five using
third-party operators to reach a wider geographical market. Yet,
according to research by Vertex, Inc. (NASDAQ:VERX) (“Vertex” or
the “Company”), a global provider of tax technology solutions, a
growing demand for cross-border sales is causing operational
challenges. The study identifies indirect tax complexities as a
concern both parties are facing and need to address.
The research which surveyed 479 finance professionals globally
(divided between marketplace operators and sellers) highlights that
selling into new territories is a key objective for online
businesses, with many using marketplaces to reach a global customer
base (39%); standout amongst competitors (35%): and expand their
‘shop front’ in target markets (31%). Respondents also stated that
half of their sales via marketplaces are cross-border
transactions.
Marketplace operators on average currently sell across 40
countries and in keeping with the boom of e-commerce, report their
revenue has increased by approximately 23% over a 12-month period.
Leading to marketplaces experiencing growth in both attracting more
customers and sellers and expanding into more countries.
89% of marketplace operators find it difficult to manage
indirect tax rules and regulations. Three quarters agree that
keeping track of these obligations becomes challenging when moving
into new countries. 74% of respondents also highlighted that an
increase in cross-border transactions is adding complexity to the
business, whilst 66% are struggling with indirect tax and financial
processes.
For sellers, 44% of finance professionals are unclear if they
are responsible for collecting VAT or if it is the responsibility
of the marketplace. This extends to their indirect tax obligations
in different jurisdictions, with 36% unsure when and where they are
liable for local, regional, and country-level indirect taxes and at
what rate. There is major confusion over tax liabilities when there
is a mix of products from multiple sellers in the shopping
basket.
Peter Boerhof, Senior Director VAT at Vertex commented: “As more
sellers turn to marketplaces to elevate trade into new territories,
they need to feel confident that operational challenges are at a
minimum. If not, sellers might be deterred from using these
platforms as a growth channel in the future. Marketplaces should
consider investing in an integrated, indirect tax engine to support
sellers with a frictionless commerce experience and to ensure
compliance obligations are met.”
Download the full report here.
Notes to editor
Research results available on request.
About the research
The research was conducted by Sapio Research UK on behalf of
Vertex. Two surveys were conducted. One amongst 268 B2B
e-commerce/marketplace operators with a revenue of $20m+; and the
other survey was conducted amongst 211 third party marketplace
sellers, with a revenue of $15m+. All respondents work within the
roles of tax, finance, or accounting and were based across Germany,
Benelux, France, UK/Ireland, US, Canada, Spain, Portugal, Italy,
Brazil, and Argentina.
About Vertex
Vertex is a leading global provider of indirect tax software and
solutions. The company's mission is to deliver the most trusted tax
technology enabling global businesses to transact, comply and grow
with confidence. Vertex provides solutions that can be tailored to
specific industries for major lines of indirect tax, including
sales and consumer use, value added and payroll. Headquartered in
North America, and with offices in South America and Europe, Vertex
employs over 1,400 professionals and serves companies across the
globe.
For more information, visit www.vertexinc.com or
follow us on Twitter and LinkedIn.
Copyright © 2023 Vertex, Inc. All rights reserved. The
information contained herein is intended for information purposes
only, may change at any time in the future, and is not legal or tax
advice. The product direction and potential roadmap
information is not a guarantee, may not be incorporated into any
contract, and is not a commitment to deliver any material, code, or
functionality. This information should not be relied upon in
making purchasing, legal, or tax decisions. The development,
release, and timing of any features or functionality described for
Vertex's products remains at the sole discretion of Vertex,
Inc. Any statements in this release that are not historical
facts are forward-looking statements as defined in the U.S. Private
Securities Litigation Reform Act of 1995. All forward-looking
statements are subject to various risks and uncertainties described
in Vertex's filings with the U.S. Securities and Exchange
Commission ("SEC") that could cause actual results to differ
materially from expectations. Vertex cautions readers not to
place undue reliance on these forward-looking statements which
Vertex has no obligation to update.
Press
enquiries: Jack
DoyleSkout PR for Vertex, Inc.jack.doyle@skoutpr.com +44 7888 177
198James WeaverSkout PR for Vertex,
Inc.james.weaver@skoutpr.com01625869418
Company
contact: Rachel
LitcofskyVertex, Inc.mediainquiries@vertexinc.com
Vertex (LSE:0A3L)
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