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Stripe launches Stripe Tax to simplify global tax compliance for businesses

Tuesday 15 June 2021 14:12 CET | News

Stripe has launched Stripe Tax to help businesses automatically calculate and collect sales tax, value-added tax (VAT), and goods and services tax (GST) in over 30 countries.

According to the press release, Stripe Tax automates tax calculation and collection for transactions on Stripe, tells businesses where they need to collect taxes, and creates comprehensive reports to make filing taxes easy. The initiative comes as businesses face significant opportunity costs in becoming compliant, but also maintaining a compliant setup globally. As a result, two-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. 

Furthermore, non-compliant businesses face legal and financial exposure as national governments around the world increase penalties for late or inaccurate filings. In the US, businesses face an average 30% interest charged on past-due sales tax. Therefore, Stripe Tax comes to simplify tax compliance for businesses across more than 30 countries. Some of its features include:

  • Real time tax calculation: By determining the end customer’s precise location, and matching that to the product or service being sold, Stripe Tax always calculates and collects the right amount of tax, and keeps up to date with rate and rule changes so businesses don’t have to.

  • Frictionless checkout: B2C businesses can reduce checkout friction with Stripe Tax, by using location information to calculate and show taxes in the most familiar way to their customers.

  • Tax ID management: For B2B businesses, Stripe Tax collects the tax identification number from customers, and automatically validates VAT IDs for European customers, applying a reverse charge or zero VAT rate when necessary.

  • Reconciliation: Stripe Tax saves businesses the pain of reconciling thousands of transactions by creating comprehensive reports for each market in which a business is registered to collect tax, speeding up filing and remittance.


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Keywords: Stripe, product launch, B2B payments, online payments
Categories: Payments & Commerce | Online Payments
Countries: World
This article is part of category

Payments & Commerce