This blog was last updated on July 4, 2025

The Global E-Invoicing Revolution: What U.S. Multinationals Need to Know

By Paula Smith, Managing Director, Indirect Tax Technology Practice, KPMG LLP; Lauren Tallman, Global Invoicing Specialist and Senior Manager, KPMG LLP; and Christiaan Van Der Valk, General Manager, Indirect Tax, Sovos 

If you’re a financial executive at a U.S. multinational company, you’ve likely encountered early warning signs about the wave of e-invoicing mandates sweeping across the globe. What may have seemed like isolated regulatory experiments has rapidly transformed into a fundamental shift in how governments worldwide monitor, collect, and enforce tax compliance. 

This transformation isn’t merely about digitizing paper invoices or upgrading accounting software. It represents a profound paradigm shift in the relationship between businesses and tax authorities, moving from periodic returns and occasional audits to real-time monitoring and continuous transaction controls.

From Paper to Real-Time Data 

For decades, businesses operated under a familiar tax compliance model: interpret tax laws, apply them to transactions, file periodic returns, and prepare for the occasional audit. This declarative model placed significant control in the hands of businesses, with tax authorities exercising oversight primarily through retrospective reviews. 

That familiar world is rapidly disappearing. The revolution is founded on a simple yet transformative principle: eliminating the interpretive space between transaction and taxation through real-time data access. 

As business processes happen, the information exchanged between trading partners is shared in real-time in a structured, standardized, authenticated form with tax administrations. This approach removes the human factor from tax enforcement on both sides of the equation.
 

The Stakes Are Higher Than You Think 

The immediate and visible consequences of non-compliance are severe and include: 

• Financial penalties can quickly become substantial—up to €2,000 per invoice in Italy 

• In Latin America, authorities can shut down business operations entirely by deactivating digital certificates necessary for legal transactions 

• In Egypt and other jurisdictions, non-compliance can even lead to criminal liability for executives 

However, perhaps more concerning than these direct penalties is the collateral damage to business relationships. If you’re not supplying your customers with valid invoices, they won’t be able to recover Value-Added Tax (VAT), creating major issues with your customers.
 

Strategic Implications 

The shift to real-time, data-rich tax monitoring fundamentally alters the relationship between businesses and tax authorities. In some countries, the tax administration knows more about your business in real-time than you do. 

Organizations that fail to develop comprehensive data strategies matching tax authority visibility may increasingly find themselves at a disadvantage in tax disputes, unable to effectively challenge assessments because they lack the data parity necessary to present alternative interpretations. 

Yet within this challenging landscape lie opportunities for forward-thinking organizations. Those who approach e-invoicing strategically—integrating compliance requirements into broader digital transformation initiatives—may discover unexpected benefits in operational efficiencies, improved supplier-buyer relationships, and valuable business insights. 

The window for reactive approaches is rapidly closing. Organizations that thrive will recognize e-invoicing not merely as a compliance challenge but as a fundamental transformation in how businesses interact with tax authorities and each other in our increasingly digital economy.

This post is the first of a three-part series based on insights from “What’s Going on Over There? The Global Impact of E-Invoicing Mandates on U.S. Multinationals,” a joint perspective from KPMG LLP and Sovos. 

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