Blog

Hidden USMCA Compliance Pitfalls for American Companies in Mexico

As part of the recently updated “new NAFTA,” or USMCA, Mexico is enticing companies to move operations into its maquiladora zone of factories along the US border. Major benefits of relocation include exemptions from value-added tax (VAT) and other taxes for qualifying manufacturers, along with a VAT rate reduced by half applied to local transactions […]

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“Trends” Report Excerpt: The Consequences of VAT Non-Compliance

The following is an excerpt from “Trends in Continuous Global VAT Compliance,” the 11th edition of the industry’s most comprehensive guide to e-invoicing, e-archiving and VAT reporting. The full report is available for download.  To reduce the VAT gap, countries are pushing taxable organizations to comply with VAT requirements and enforcing different types of legal […]

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New Global VAT Compliance Report Provides Guidance for Multinationals

Companies are dealing with a fundamental shift in the way they do business with trading partners. In a rapidly increasing number of countries, there’s a third party inserting itself into every transaction. It’s the government, and it’s wedging its way into every order a company ships or receives.  In an effort to close a massive […]

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Ensuring SAP Tax Compliance and Data Purity in AP E-invoicing Processes

About a decade ago, countries in Latin America, led primarily by Mexico, Brazil and Chile, stepped up their efforts to close the VAT gap by requiring companies to move away from paper-based invoicing processes and toward electronic methods of billing and completing payments. The idea was that a tax administration could more easily and effectively […]

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Extension of Mexican E-invoicing Mandate Puts New Pressure on Maquiladoras

A new wrinkle in Mexican electronic invoicing adds complexity to the e-invoicing process for maquiladoras, or foreign-owned factories operating along the US-Mexico border.  Compared to some other countries in Latin America, Mexico has kept its core electronic invoice, the CFDI, relatively simple. Whereas an invoice in Chile has 250 fields or more of required information, […]

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Meeting the New Indirect Tax Challenges of Accounts Payable Automation

A substantial number of companies are unaware of the full challenges around tax compliance and their procurement processes. Part of the challenge is that tax compliance must functionally sit with procurement and other business functions in the enterprise that own the data interchange, while the ultimate responsibility for tax compliance remains with the tax department. […]

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Indirect Tax Compliance Challenges in Accounts Payable Automation

AP automation is supposed to save SAP customers money, but developments in digital tax could derail its benefits and actually create further liabilities. With tax authorities all over the world seeking to increase revenues and close tax gaps, IT professionals and AP system administrators face new challenges in indirect tax compliance. Among those challenges are […]

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IMF Study Demonstrates Peru E-invoicing Works for Business and Government

Far from being a burden, Peru’s electronic invoicing mandate has helped medium-size businesses embark on digital transformation while also catalyzing a broadening of the country’s tax base. The International Monetary Fund (IMF) will release this fall a study detailing the impact mandatory e-invoicing in Peru, which began in 2014 and has since moved to a […]

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New Argentina E-invoicing Mandate Focuses on Improving SMB Financing Options

As a result of an e-invoicing mandate currently rolling out in Argentina, small and medium-size businesses (SMBs) are or will soon be required to use a specific form of invoice when billing larger companies.  Companies classified as SMBs (or PyMEs in Spanish) by AFIP, the Argentine tax administration, are required to use the Facturas de […]

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The Rising Tide of Digital Tax: Are You Surfer or Shark Bait?

Anyone familiar with the Discovery Channel’s Shark Week and the portrayal of hungry sharks setting their sights on surfers may be surprised to learn that tax and IT professionals may be feeling every bit as wary as those surfers as they enter their own version of shark-infested waters. The reason: IT and tax pros are […]

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Why Clearance E-invoicing Is Both Inevitable and Positive for Businesses

Clearance-model e-invoicing will sweep the globe because it works – at least for tax administrations. With the VAT gap opening to more than half a trillion dollars worldwide, governments around the world are likely to follow the Latin American model of tax authorities inserting themselves into transactions. A new report from Bruno Koch at industry […]

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How to Get Control of Your Invoice Archives: It’s Not Too Late

We all know that invoicing processes are increasingly tangled up in real-time and other complex tax requirements around the world. However, when you ask companies if they are in control of the storage of their accounts payable and accounts receivable invoices, you often get somewhat surprised—if not vaguely insulted—reactions. Really, what kind of company doesn’t […]

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Colombia DIAN UBL 2.1 E-invoicing Mandate Reminds SAP Shops Why Compliance Matters

Colombia’s new electronic invoicing mandate serves as another reminder to SAP that compliance has to be at the heart of digital transformation efforts and migrations to SAP S/4HANA. The South American country, following the lead of Latin American neighbors Brazil and Mexico, is moving from a reporting e-invoicing model to a clearance model. Effectively, that means […]

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A New VAT System for Costa Rica – Part I

The Costa Rican government enacted law 9635/2019 which introduces a new value added tax (VAT) system effective July 1, 2019. The new VAT replaces the current hybrid General Sales Tax (locally known as IGV) which existed for almost four decades. The new VAT is markedly different from the IGV, with some of the key differences […]

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Shielding SAP Central Finance Migrations from Tax Compliance Mandates

With more companies focusing on global integration, cross-border supply chains and expanding ecommerce, governments across the globe are introducing new ways to enforce tax rules and close their tax gaps. The evolving global regulatory environment produces unique tax determination and reporting challenges in the United States and additional VAT and e-invoicing compliance challenges around the […]

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Sovos Expert to Speak on Tax Compliance in S/4HANA at SAPPHIRE

Pawel Smolarkiewicz, chief product office at Sovos, will speak on the digital transformation of tax and its effect on SAP S/4HANA at next week’s SAPPHIRE conference in Orlando.   As countries make continuous tax compliance the new normal, businesses are finding that they have to respond by putting tax compliance functionality at the core of […]

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E-invoicing: Optimization Strategies to Withstand the Digital Tax Tsunami

The great corporate awakening Many corporations that previously saw e-invoicing mandates as a developing country problem are now realizing that invasive transaction-based digital tax controls are popping up everywhere around the world. Teams of experts and executives across finance, IT, tax and other functions are being pulled together by leading enterprises to define ways to […]

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SAP Central Finance Drives Move to S/4HANA, Making Tax Compliance a Priority

SAP Central Finance is driving migration to SAP S/4HANA as companies look to deliver value to their finance and accounting organizations, as well as improve on the configuration of previous financial systems. And for most companies making the transition, tax compliance is a priority. In a recent survey by SAP Insider, 74 percent of SAP […]

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