Taming tax complexity in the medical equipment, devices & supplies segment

An acute case of indirect tax compliance complexity frequently strikes buyers and sellers of medical equipment, devices and supplies.

Regardless of whether your company is a manufacturer, wholesaler, distributor, institutional buyer or a group purchasing organisation (GPO), this unique tax compliance malady stems from a common set of triggers, including: 

• Ambiguous laws regarding reduced rate or full tax exemptions;
• Numerous, rapidly changing tax rules and rates for sales and use tax (SUT), consumer use tax (CUT), value added tax (VAT) and other goods and services taxes (GST) in North America, Europe and other regions;
• Multi-jurisdictional and cross-border transactions; and
• International operations and organisational complexity (e.g., non-profit subsidiaries).

A host of internal changes and challenges also indirectly complicate tax compliance activities, including staffing shortages, cashflow pressures and business/digital transformation. Additionally, buyers and sellers of medical equipment, devices and supplies must keep pace with changes to product categories and classifications, including commodity codes and other industry taxonomies.

The symptoms of tax compliance complexity are also widespread – and potentially severe; they include:

• Tax determination errors;
• Higher volumes of refund claims;
• A higher risk of audits and audit penalties following a large refund claim;
• Negative customer experiences;
• Higher IT maintenance and support costs;
• Inefficient tax operations;
• Less budgeting predictability for tax operations; and
• Insufficient tax exemption management.

 Fortunately, there is a remedy.

Vertex O Series for Medical provides industry-leading content built specifically for medical equipment, devices and supplies manufacturers, wholesalers, distributors, institutional buyers and GPOs.

This solution, which delivers monthly tax content updates and integrates with most enterprise resource planning (ERP) systems, helps reduce risk and increase efficiency throughout sale, purchase and billing processes. Here’s a deeper look at how Vertex O Series for Medical helps improve tax operations.