Stripe Debuts Stripe Tax for Platforms to Help Cross-Border Sales
Stripe says it is offering its Tax tool to its platform clients to boost their global commerce sales.
“Help with sales tax and VAT has been our platform users’ most commonly requested feature,” Michael Carney, product lead for the tool, known as “Stripe Tax,” said in a news release Wednesday (Aug. 2)
“We built Stripe Tax because it’s a logical extension of payment processing, and now we’ve built Tax for platforms so platforms can offer it to their customers and help them with all aspects of the transaction lifecycle.”
With Tax for platforms, the company added, businesses have an easier time selling across borders, with a no-code solution for complex tax requirements involved in international sales.
“The challenge is huge, in large part because the tax landscape is constantly changing: last year there were more than 600 sales tax rule and rate changes in the US alone, and an even larger number of VAT changes in the EU,” the release said.
The company also points to its own in-house report that shows 18% of businesses say tax complexity is the reason they’re not going after international expansion.
Stripe Tax, introduced in 2021, automatically calculates and collects the correct sales tax, VAT, and GST across more than 40 countries and all U.S. states.
The tool also speeds up the filing process through automated, location-specific reporting for each state in the U.S. and provides summarized reports that can be filed in all countries where a business is registered to collect tax.
PYMNTS looked at the complexities of cross-border payments Wednesday in a conversation with Guillaume Tournand, VP of growth and digital commerce at Worldline.
“The best value proposition that plays in the payment ecosystem is to unlock for merchants complex, international economies and opportunities by doing the heavy lifting that opens up the growth potential in a neat and convenient way,” Tournand said.
Doing so is as difficult as it sounds, with an array of international payment frustrations and reconciliation frictions stemming from ongoing and historical operational bottlenecks.
“There are headwinds of complexity,” Tournand said.
Among these are various local regulatory frameworks specific to each country or region, new currencies, and new sets of payment service providers (PSPs) to integrate. Meanwhile, merchants also have to decide on secure ways to avoid the low approval rates of cross-border transactions. Integrating into a new economy, Tourand told PYMNTS, requires a huge “technical and compliance” lift.
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