Stripe Launches Global Tax Compliance Service
Stripe launched its own tax compliance service for businesses in more than 30 countries around the world Thursday (June 10), the FinTech announced in a press release emailed to PYMNTS.
Using location data, Stripe Tax calculates and gathers accurate sales tax, goods and services tax (GST) and value-added tax (VAT) for businesses, the release stated. The service, which is based in Ireland, is available across the U.S. and in countries such as the United Kingdom, Germany and Australia.
Stripe Tax also displays taxes in a familiar way to customers of its B2C firms. And for B2B firms, Stripe Tax gathers tax identification numbers and, for European businesses, validates VAT IDs. The service also provides reports to businesses to aid in tax filing, according to the release.
The announcement comes less than two months after the FinTech’s acquisition of TaxJar, a platform with a suite of tax tools for internet businesses. Moving forward, TaxJar will work with Stripe Tax to “fully automate tax compliance for any business selling any product, anywhere,” the release stated.
“[T]wo-thirds of businesses say managing tax compliance holds back their growth, with a majority saying they would launch more products and expand into more countries if relieved of the burden,” the release stated, citing a report from Stripe.
Notably, tax rules vary country to country and jurisdiction to jurisdiction. There are 11,000 different tax jurisdictions in just the U.S., according to the release, and rules can apply differently on individual goods and services.
Stripe has been expanding its revenue platform, PYMNTS reported. Last month, the company introduced Payment Links, which allows businesses to create payment pages with which users can send payments without being on the business’ website; rather, they can send payments over social media, email and the like.
Stripe Tax has been in pilot mode for the last six months, according to the release.