Three relevant trends we’re not emphasizing in our November 2017 white paper – and why
Last week we released the latest edition of our annual white paper on e-invoicing and e-archiving compliance. Judging from the record number of downloads and feedback received so far, the document was well received. With its 80 pages, detailed analysis and regulatory summaries for some 90 countries it’s a substantial document. Nonetheless, there’s a lot more where this came from; our experts are collecting and processing facts about the ever-changing legal situation around the world every day, and a white paper that doesn’t just outline the main trends and status could easily be ten times as long. So we thought we’d share a list of the top three issues that could have been addressed in the November 2017 edition but ultimately didn’t make it:
- Block chain. How can you issue a white paper on anything and not talk about block chain, you’d say? We kept this out not because the technology is immature or uninteresting, but because the market introduction hype cycle has reached its very peak of inflated expectations and – as is typical in such circumstances – there’s way too much speculation about how this technology could be a silver bullet solution for anything from supply chain optimization to solving world hunger. We are seeing a lot of tax administrations drool over this technology – after all it has trust and control written all over it – and many of our partners are making deep investments into this area as well. We may write about what we have learned from talking to and working with these parties in a next edition, but for this one we prioritized actionable information about tangible trends for practitioners over speculation.
- European invoice reporting schemes. This was a difficult one. On the one hand, it’s a development that many view as getting very close to Latin American-style real-time e-invoicing. On the other hand, EU Member States introducing such measures are going out of their way to make sure these requirements are not called e-invoicing. And while that’s hypocritical and counterproductive to say the least, many of these schemes do retain features from the VAT reporting domain that make it hard or impossible to implement compliance support for them as part of an e-invoicing transaction engine. We write and speak a lot about this phenomenon and are involved in a good number of policy discussions aimed at removing some of the terrible uncertainty that arises out of these different features, but we didn’t want to create more confusion in the marketplace: until further notice, we consider that these EU direct invoice reporting schemes aren’t sufficiently transaction-oriented to fall into the category ‘e-invoicing’ and can only be implemented in conjunction with a company’s ERP or accounting software.
- The dreadful idea of a clearance platform transmitting invoices to buyers. Don’t get us started on this one. It’s really exciting to live at a time when tax administrations are actually driving the IT adoption agenda of companies worldwide. Of course, if you’re a corporate tax or IT manager in the middle of trying to figure out how to deal with the recent changes to the Mexican technical specification (CFDI new version 3.3), you’ll probably be cursing the day tax administrations started to view technology as a tool for revolutionizing law enforcement; but if you take a step back, you’ll have to admit that there is a real opportunity here for things to get a lot better than in the world of paper. A lot of larger and smaller errors are being made during the current introduction and experimentation phase, and the jury is still out on the perfect real-time invoice control model, but we know one thing for sure: using a transaction clearance point to actually transmit the ‘original’ tax invoice to the buyer is just about the worst thing tax administrations can do if they care a modicum about economic growth. It’s a bridge too far that basically architects B2B automation service providers, and the massive amounts of business efficiencies they offer, out of the equation. Turkey, and arguably Russia, have gone down this path and it’s fraught with problems. So this is a big deal, but we didn’t address it in the white paper for two reasons: (a) it’s a political rather than a practical issue – after all if this is the rule in a country under whose law you’re invoicing electronically you have no choice but to comply; and (b) it’s an issue that can massively complicate the lives of service providers, but doesn’t have the same dramatic impact on users, and we didn’t want to take too much of an operator perspective in describing implementation challenges in clearance countries.
Join our LinkedIn Group here or contact us now.
Christiaan van der Valk, Company President, TrustWeaver