Imposed by the government, tax is an obligatory charge levied on a taxpayer to spend on the welfare of the public. However, on the ground of failure to pay taxes is punishable by law and it can lead to severe actions taken by the tax authorities. Moreover, tax management allows users to manage their income, transactions, and expenses. In addition, the software is specifically designed to deliver companies or individuals to ensure tax compliance for customs, income tax, service tax, VAT, sales tax, corporate tax, and other similar taxes.
The global Tax Management market is expected to develop US$ 61.4 Bn by 2032, at a compound annual increase in price (CAGR) of 11.3% throughout the forecast period.
The global tax management market size is anticipated to reach nearly USD 32 billion by 2025. This can be attributed to the increasing number of transactions due to digitization across numerous industry verticals. Also, complexities associated with the existing tax systems are one of the major reasons driving the tax management market growth.
However, the growing concern about the confidentiality of data is expected to hamper the market growth. Furthermore, the advent of blockchain technology is expected to offer lucrative growth opportunities for the market in the forthcoming years.
Tax Management Market Scope
|Revenue forecast in 2032
|US$ 61.4 Bn
|CAGR of 11.3% during 2022-2032
|By Component:, By Deployment Model, By Organization Size, By Tax Type, By Vertical, Regions
|North America, Europe, Asia Pacific, South America, Middle East and Africa
|Key Players Profiled
|Avalara, Inc., ADP, Inc., Wolters Kluwer N.V., Thomson Reuters., Intuit Inc., H&R Block, Inc., SAP, Blucora, Inc., Sovos Compliance, LLC., Vertex Corporate, Shoeboxed, Inc., Sailotech., SAXTAX Software, Paychex Inc., CrowdReason, LLC., Defmacro Software Private Limited, OUTRIGHT MARKETING PRIVATE LIMITED, DAVO Technologies., Xero Limited., TaxSlayer LLC, Taxback International, TaxCloud, Drake Enterprises, Canopy Tax, Inc., TaxJar., among other domestic and global players
Key Segment Of The Tax Management Market
By Component (USD Billion)
Deployment Mode, (USD Billion)
By Organization Size, (USD Billion)
• Small and Medium-sized Enterprises (SMEs)
• Large Enterprises
By Tax Type, (USD Billion)
• Indirect Tax
• Direct Tax
By Vertical, (USD Billion)
• Banking, Financial Services and Insurance (BFSI)
• Information Technology (IT) and Telecom
• Energy and Utilities
• Healthcare and Life Sciences
• Media and Entertainment
Regional Overview, (USD Billion)
• Rest of Europe
• Rest of Asia Pacific
• Rest of South America
Middle East and South Africa
Frequently Asked Questions (FAQ) :
The tax management software streamlines the overall process of calculating the company's or individuals' tax obligations/compulsions and filing tax through tax forms. The major reason behind the growing adoption of tax management software is the increasing need to minimize human errors and provide users with an easy solution to calculate tax payment. Moreover, the increasing regulations and strict policies related to tax systems are expected to create lucrative opportunities for the market in the upcoming years. Furthermore, the increasing adoption of digitalization across the financial sector is also fuelling the demand for tax management solutions and systems.
Based on the component segment, the market is divided into software and services. In 2019, the software segment gathered the highest market revenue and it is projected to remain dominant throughout the forecast period. The dominance of this segment is primarily attributed to the increasing preference for cloud-based software deployments. However, the services segment is projected to attain the highest growth during the forecast period.
Tax Type Segment
Based on the tax type, the market is segmented into direct tax and indirect tax. The indirect tax segment held the market share in 2019 and it is projected to remain dominant throughout the forecast period. On the contrary, the direct tax segment is estimated to gather the major CAGR during the forecast period 2020-2025.
End Users Segment
Based on end-users, the market is segmented into individual and commercial users. In 2019, the commercial segment gathered the highest market share. However, the individual users' segment is expected to experience major market growth during the forecast period.
Industry Vertical Segment
In terms of the industry vertical, the market is segregated into BFSI, retail, manufacturing, healthcare, IT & telecom, media & entertainment, others. In 2019, the BFSI segment accounted for the highest market share. The growth of this segment is primarily attributed to the increasing number of transactions due to the growing adoption of digital payment systems. On the contrary, the retail industry is projected to gather the highest growth among the other industries.
The North America region is anticipated to gather the highest market share during the forecast period. The dominance of this region is primarily accredited to the increasing investment in new sports analytics technology. However, the Asia-Pacific region is anticipated to experience significant growth during the forecast period 2020-2025. The market growth in this region is mainly attributed to the increasing number of sports leagues and the growing trend of digitalization in this region.
The major players of the global tax management market are SAP, Wolters Kluwer, Vertex, Avalara, Intuit, Outright, H&R Block, ADP, Blucora, and Sovos. Moreover, the other potential players in the tax management market are Canopy Tax, DAVO Technologies, Defmacro Software, Sailotech, and TaxCloud. The recognized companies are coming up with innovative and new tax management software solutions. For instance, in November 2019, Avalara, a tax compliance automation software provider partnered with Open Systems, Inc., business management software Solution Company. With this partnership Open Systems, Inc., integrated with Avalara’s SouthWare ERP and ProcessPro solutions to provide a comprehensive view of an entire operation to their customers which would further allow them to make data-driven decisions.