Business
Research Identifies Marketplaces at Risk of Losing Sellers if Steps Aren’t Taken to Resolve Indirect Tax Challenges
LONDON, Feb. 23, 2023 (GLOBE NEWSWIRE) -- Eighty-seven percent of sellers using marketplaces to trade online report experiencing revenue increases, viewing it
About this update from Vertex, Inc.
[{"type":"text","content":"LONDON, Feb. 23, 2023 (GLOBE NEWSWIRE) -- Eighty-seven percent of sellers using marketplaces to trade online report experiencing revenue increases, viewing it as a vital channel for growth. Yet, according to research by Vertex, Inc. (NASDAQ:VERX) (“Vertex” or the “Company”), a global provider of tax technology solutions, seven out of ten believe that indirect tax challenges could deter them from using marketplaces in the future. The research which surveyed 479 finance professionals globally (split between operator and seller businesses) found that 81% of businesses are taking advantage of marketplaces to attract new customers and sell into more countries. They attribute this expansion into marketplaces for the following reasons: to reach a wider geographical market (57%); to be more competitive (50%); to tap into cross-border sales opportunities (48%); and to help manage tax liabilities (34%). Over half of respondents agree that marketplaces are getting easier to use as a sales channel, but they also share that sellers are demanding more support from operators especially when it comes to achieving a frictionless commerce experience. Respondents indicate they are looking for support to ensure: transactions and money transfers are more seamless (65%); greater guidance on tax liabilities (64%); and compliant invoicing (63%). Whilst operators are keen to engage, with 85% looking to increase their seller base, the complex relationship that exists between marketplaces and third-party online businesses is making this difficult, putting areas such as tax under strain. In fact, tax and financial issues are ever present on the list of challenges that operators face when expanding their seller base. Four out of seven operators agree they struggle not only with seller confidence in the platform but also managing tax liabilities with the seller, complex baskets and invoicing, and tax complexities around seller shipping locations. Sellers concur as they too report experiencing a wide range of issues when selling through marketplaces including balancing tax liabilities, knowing when and where they are liable for tax, and inaccurate tax calculation inflating prices. Every step in a transaction brings multiple complications. Forty-five percent of sellers reveal that operators should improve finance and tax automation processes to help overcome t...