02/25/2025
Sales Tax and VAT are not income tax. Hello Executives! I would like to explain Vertex, Thomson, Avalara, Stripe, and invoicing and payables. Executives, roll up your sleeves, understand TAX. Do not just "outsource" Tax to your tax consultants. You, yourself, the Controllers around the world, if you are shipping from China, to Hong Kong, to The EU, and the UK, to the America's, you cannot have the mind set, let Tax, and Tax consultants handle it.
That is not understanding VAT. VAT is not sales tax, and VAT is not income tax. VAT is part of your fulfillment. I worked for a company where they spent 30 minutes on the fulfillment, and did not mention the word tax, shipping from China, to Hong Kong, to the EU, to the UK, to Miami.
I worked for a company that worried about tax after fulfillment in the USA without exemption certificate management. I talked with the CEO of a tax software company about it, and he said executives think exemptions are secondary to fulfillment of an order. Larry Ellison, and Oracle do not think this. We need these serious conversations without animosity, and blaming the tax guy. Avalara, and other middle market vendors should take a leadership role in fulfillment.
I am perplexed, that you have a 30 minute training on payables and do not invite a 35 year veteran tax manager to the table on purchases around the world and do not mention the words VAT or Tax.
Everyone know what an input tax credit is?
Everyone know why Massachusetts charges 6.25% rate and what value added tax actually means, for example, what is the "value added" mean with a country like the UK? So you pay tax on your purchase, and you sell it to your client and they pay tax on their purchase. You are netting the two for the payment to the United Kingdom.
What happens when your fulfillment people do not understand VAT and they are shipping allover the world? Sounds dangerous to me. Is the EU helping? I would say not. The EU wants your input tax credit to go away. So it is VAT on the customer invoices only (for simplicity). This is a cost to everyone. This is not simplicity, this is cost increase in the EU. Is this a partial reason why the UK left? The UK is smart, and we the the child of the UK, the USA, and we did capitalism better than mom and dad!
I am not an Economics Major but maybe I should have been. I am thinking like an Economist, not a tax accountant.
I can help your company fulfillment with tax at the heart of the conversation. Let NetSuite and Thomson, or Vertex be your engines or Oracle Cloud or SAP. I def am not a fan of Avalara's price gouging.
Thomson and Vertex why did you let Avalara steal the middle market? You forgot how to compete?
Hans Steuber MBA
www.steubertax.com
Tax CEO at SteuberTax Consulting LLC
Steubertax prep service provides comprehensive tax services for individuals and businesses. We help you file your tax return, claim your tax refund, navigate your tax bracket, and obtain a tax extension if needed. Take control of your finances with our affordable tax preparation services.