Avalara for Communications manages escalating tax complexity

Streaming company fuboTV Inc. integrates predictive, free-to-play games into select sports content. As a cable television replacement product, fuboTV aims to turn passive viewers into active participants by defining a new category of interactive sports and entertainment television.

Based in New York, the company has customers in all 50 states and is growing its international footprint through acquisitions.

Senior Vice President and Controller Larry Wills joined fuboTV in 2018, shortly after the U.S. Supreme Court’s landmark decision in South Dakota v. Wayfair, Inc. “That was really a game changer. That decision opened up a revenue stream for many states that didn’t exist prior to that decision,” he remembers.

Since the Wayfair decision, Larry has watched a growing number of states change their legislation to begin taxing streaming services.

Communications taxes, which are different and more complex than sales tax, often require separate and specific returns.

And for every state that starts taxing streaming services, there are multiple jurisdictions within that state to be considered. “There are city taxes, there are county taxes,” says Larry, “and the filing frequencies are all over the place. That’s what really makes it complicated.”

Building the muscle to keep up with those growing complications required resources that fuboTV simply didn’t have. Larry wanted an automated solution with built-in expertise that would integrate well with Recurly, the system that fuboTV uses to sign up and bill its subscribers. Avalara had a pre-built connector to Recurly which made it even easier for fuboTV.

“Avalara certainly fit the bill,” he says. “We don’t have any credit card information for our subscribers,” Larry explains. “Everything is done through Recurly, so it was critical to find a partner that could integrate with Recurly. Avalara knows the locations where we generate revenue and files the returns for us.”

In addition, speed and reliability matter when selling online. With Avalara as part of fuboTV’s subscription transactions, the company is able to mitigate the risk of transaction abandonment.