Groupon relies on Avalara to reduce tax complexity

We live in a global economy, powered by numerous channels. Groupon provides convenience as the go-to destination for millions of consumers to connect with both local and global businesses for products, services, and experiences.

Groupon is a global marketplace and must comply with many reporting obligations, including economic nexus and marketplace rules in the United States, and e-invoicing and tax transparency laws internationally.

“The indirect tax landscape, both in the U.S. and abroad, is rapidly transforming right now,” says Brad Caproni, director of global indirect tax for Groupon. “Tax authorities are doing everything they can to keep up with the digitization of the global economy and maintaining compliance with these new and changing laws is incredibly difficult.”

Groupon needed a reliable tax calculation engine to work with their existing systems; one that would not cost a fortune to implement.

“Avalara was easy to partner with,” says Brad. “We currently use AvaTax to handle all of our domestic sales tax calculations and we use Avalara Returns to manage our hundreds of monthly sales tax filings.”

Avalara partnered with Groupon to create a solution that allows Groupon merchants to have their own AvaTax accounts nested under Groupon’s account. In states that require marketplaces to collect tax on behalf of the merchants selling on their platforms, Groupon can collect tax without any action on the merchant’s part. In other states, Avalara allows Groupon merchants to decide whether Groupon will collect tax for them at checkout. If they choose not to have Groupon collect tax for them, Groupon can instead pass the tax through for the merchant to remit.

“The custom solution we developed with Avalara was an absolute game- changer,” says Brad. “It allows us to keep inventory on our platform without becoming noncompliant.”