By Guest contributor |
In today’s rapidly evolving business environment, tax compliance has become more complex than ever before. From changing global regulations to the increasing digitisation of transactions, organisations are under pressure to stay compliant while maintaining efficiency and controlling costs. Manual processes are no longer enough as they’re often too slow, error-prone, and costly to scale. At Avalara, we’re pioneering the use of AI and end-to-end automation to transform how businesses approach tax and compliance, enabling them to reduce risk, accelerate processes, and achieve new levels of operational efficiency.
Tax and compliance has historically been viewed as a necessary cost of doing business, but not a strategic advantage. Unfortunately, relying on spreadsheets, manual research, and disparate systems leaves businesses vulnerable to risk and inefficiency. Errors in tax calculation, misclassified products, or outdated exemption certificates can quickly add up to penalties, audits, and reputational harm.
As transaction volumes grow and regulatory requirements expand in the areas of real-time e-invoicing and digital reporting, the challenges only intensify. Businesses need a smarter, more proactive way to manage compliance. That’s where agentic tax and compliance comes in.
Avalara’s AI-powered platform is redefining what’s possible in tax compliance. By embedding virtual agents, applying intelligent product classification, and leveraging machine learning, we’re helping organisations eliminate manual bottlenecks and achieve compliance with speed and accuracy.
Embedded virtual agents act as always-available resources, answering questions, guiding users through compliance tasks, and offering proactive insights to prevent issues before they arise. Intelligent product classification, meanwhile, automate one of the most time-consuming and error-prone tasks: mapping products to the correct tax codes. By training on millions of product data points, Avalara’s AI significantly improves accuracy, reducing audit risk.
Proactive automation, on the other hand, extends across key workflows, from sales tax calculation and exemption certificate management to global e-invoicing. These capabilities ensure that compliance tasks happen seamlessly in the background, so businesses can focus on growth rather than manual administration.
Technology is only as powerful as the results it delivers. That’s why Avalara recently commissioned a Forrester Total Economic Impact study to quantify the value of our solutions. The findings were compelling: Microsoft Dynamics users leveraging Avalara saw measurable returns on investment, from reduced compliance costs to fewer errors and improved team productivity.
By automating routine compliance activities, businesses were able to reallocate resources to more strategic initiatives, while also reducing the likelihood of costly penalties. The study highlights not just operational efficiencies, but also the strategic benefits of using Avalara’s platform as a trusted compliance partner.
The future of tax and compliance is not just about keeping up with regulations, it’s about staying ahead of them. By investing in AI and automation, businesses will proactively adapt to new rules, emerging technologies, and shifting customer expectations.
Among the most significant benefits is the increased speed of operations. Automation accelerates compliance tasks, ensuring businesses can keep pace with fast-changing markets. Simultaneously, AI-driven classification and validation reduce human error, minimising audit risk. There is also a considerable increase in efficiency, as integrated solutions free teams from manual work, driving down costs while increasing scalability.
As governments introduce more real-time reporting requirements, stricter audit rules, and increasingly complex tax regimes, tax and compliance leaders are under pressure to ensure accuracy while containing costs. This is not just about solving today’s challenges, but building a resilient compliance strategy for tomorrow.
Vsu Subramanian is senior vice president of engineering at Avalara
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