The cloud’s position as the foundational platform for digital transformation has been strengthened by the surge in home-based work. Vendors of mission-critical systems like enterprise resource planning (ERP) and customer relationship management (CRM) are heading for the cloud, too (if they’re not already there). But tax? Is it really a good idea to migrate your sales tax functions to the cloud?
A Vertex white paper, 5 Reasons to Migrate Tax Solutions to the Cloud, suggests that it’s definitely worth considering. Cloud enables you to:
1. Increase Operational Efficiency
Many CIOs are looking to spend less time on the business of managing infrastructure and more time on the business of … well, the business. Tax executives also want to up their strategic games. But, between evolving business models, mobile sales, sell through sales channels, e-commerce, consumers use tax—and let’s not forget value added tax (VAT)—transaction tax can be a tough nut to crack. The U.S. alone has more than 11,000 tax jurisdictions, the rules and rates are constantly changing and compliance soaks up huge amounts of staffers’ time. Cloud-based tax applications can run those updates invisibly and efficiently, freeing up resources for more strategic endeavors.
2. Improve the Customer Experience
Cloud solutions can help companies make their customers’ lives easier by ensuring that exemption certificates are kept up-to-date. If you do business online, these solutions can integrate with your e-commerce platforms, so your customers can be confident that the right tax calculations are being applied.
3. Improve Security and Data Protection
Major cloud platforms provide a level of security that few companies would be able to achieve with their own internal resources. Many also provide options for advanced backup and recovery.
4. Transform your Business Processes
Digital transformation and process transformation go hand-in-hand. Many e-commerce platforms and ERP systems are already cloud-based, and tax is closely intertwined with both. Migrating tax functions to the cloud enables you to gain the most value from the integration with these vendors’ products.
5. Improve Profitability
When you add it all up – the potential to build efficiencies, accelerate revenue-generating opportunities, rein in costs, give your people more time for innovation, enhance the customer experience and customer retention – the move to the cloud could be a real opportunity to improve your organization’s bottom line.
Please remember that the Tax Matters provides information for educational purposes, not specific tax or legal advice. Always consult a qualified tax or legal advisor before taking any action based on this information. The views and opinions expressed in Tax Matters are those of the authors and do not necessarily reflect the official policy, position, or opinion of Vertex Inc.