Stripe is building out its tools for small businesses this week. The ecommerce technology company launched Stripe Tax, after completing a six month long pilot.
The new tool helps businesses automatically calculate and collect sales tax, VAT, and GST on the merchant’s behalf. Not only this, the new offering also generates reports and helps businesses navigate complicated regional requirements. The capabilities will lift a burden off small businesses, especially in the U.S., where there are over 11,000 different tax jurisdictions.
“No one leaps out of bed in the morning excited to deal with taxes,” said Stripe Co-founder and President John Collison. “For most businesses, managing tax compliance is a painful distraction. We simplify everything about calculating and collecting sales taxes, VAT, and GST, so our users can focus on building their businesses.”
Stripe Tax features include:
- Real time tax calculation, which leverages the customer’s location to calculate and collect the right amount of tax and keeps up-to-date with rate and rule changes
- Frictionless checkout, which reduces checkout friction by using location information to calculate and show taxes to customers.
- Tax ID management, which helps B2B businesses collect the tax ID number from customers and validate VAT IDs for European customers
- Reconciliation, which creates comprehensive reports for each market in which a business is registered to collect tax
The tax calculation and collection capabilities will be available in Australia, Austria, Belgium, Bulgaria, Croatia, Cyprus, Czech Republic, Denmark, Estonia, Finland, France, Germany, Greece, Hungary, Ireland, Italy, Latvia, Lithuania, Luxembourg, Malta, New Zealand, the Netherlands, Norway, Poland, Portugal, Romania, Slovakia, Slovenia, Spain, Sweden, Switzerland, the U.S., and the U.K.
The launch follows Stripe’s acquisition of tax tool startup TaxJar in May. “With TaxJar, we will help millions of internet businesses running on Stripe with their sales tax and make it easier for them to sell internationally,” commented Stripe CFO Dhivya Suryadevara. “And as a CFO, I’m delighted to welcome so many new colleagues who care deeply about taxes!”
It also comes after a rather sizable funding round the company announced in March, when Stripe raised $600 million in funding. The Series H round brought the company’s total funding to $2.2 billion and boosted its valuation to $95 billion.
Photo by Kelly Sikkema on Unsplash