While Congress debates whether to make online sellers collect sales tax from online buyers in 9,600 taxing jurisdiction, another government mandate for ecommerce is already underway.
U.S. federal government agencies recently began requiring their suppliers to bill them electronically. The U.S. government says paper invoices and manuals too often lead to overpayment, underpayment, nonpayment and fraudulent payment.
If the government believes e-invoices better track money paid and received, how long until e-invoicing is a private sector mandate like it is in Mexico and Brazil? Maybe not soon, considering the full plate in front Congress and the Obama administration right now. Or at all since it’s not certain the U.S. government has the appetite to dictate payment methods in private transactions.
But e-invoicing would at least have a chance to be better received than the Marketplace Fairness Act internet sales tax law under consideration now -- because e-invoicing actually saves money.
The EU Commission, which wants European governments to receive its bills electronically, expects the EU to save 5 to 20 percent in procurement spend through the measure, Purchasing Insight reported. A Spend Matters interview probed advantages for both government and business.
"Electronic invoicing streamlines operations on a number of levels,” said Eric Alessi, President of Essent, which develops business management software that automatics business operations, including invoicing. "E-invoicing substantially reduces and in most cases eliminates paperwork, printing costs, mailing costs, storage costs, data entry, and data entry errors," he said, "and gets bills paid faster.”
"Done right document processing automation, including e-invoicing, significantly reduces costs,” Alessi added. "With e-invoicing, you have savings throughout your procurement pipeline.”