The survey found the following takeaways:
- Barriers continue to remain even when businesses know they must improve their sales and use tax strategies. Nearly every person surveyed (98%) said there are problems in changing their company approach. Limited IT resources (34%) and leadership not being made aware of a business need for compliance process improvements (60%) were some of the top issues cited.
- 35% of finance and accounting decision makers said keeping up with the speed and volume of tax rate and rule changes is one of the most significant sales tax compliance difficulties their department faces. With finance pros often wearing multiple hats at their company, working to maintain compliance can lead to burnout.
- Sales tax compliance takes up more time than initially anticipated. The survey found that updating transaction systems to reflect rate changes (36%) and researching tax rates for applicable jurisdictions and states (35%) consumes the most time for finance and accounting teams. Additionally, 47% of respondents said their organization spends between four and five business days each month on sales tax compliance.
- 56% of respondents said their department’s sales tax software solution(s) are not yet in the cloud. However, larger companies with revenues of $1 billion or more were more likely to have already adopted cloud solutions.
Omnichannel retailers need the right tools and processes in place to properly meet the ever-evolving sales and use tax filing and reporting requirements. Economic nexus was just the beginning, and it is hardly going to be the last challenge for businesses to overcome.
Limited IT resources, budget constraints and lack of leadership buy-in can all impact retail organizations’ approach to sales and use tax compliance management. But those obstacles do not have to be insurmountable. Opting for a comprehensive and centralized platform with access to the latest forms, the ability to streamline audit activities and ongoing support for any technical issues is key for sales tax compliance.