The news: Sovos will automate Shopify’s sales tax returns process for merchants.

Sovos’ Sales and Use Tax (SUT) platform will integrate into Shopify Tax to streamline the preparation, filing, and remittance of sales tax returns.

The two said that automating Shopify Tax can save merchants hours prepping tax returns and decrease their audit risk.

Shopify partnerships: Shopify is all-in on using new technologies and other automation tools to create greater efficiencies. Shopify’s integration with Sovos follows a string of partnerships the company has made to reduce friction for merchants. 

• Shopify partnered with Coinbase and Stripe to expand stablecoin retail payments
• Target integrated with Shopify last year so that merchants can apply to appear on the Target Plus online marketplace.

Shopify also acquired Vantage Discovery, a generative AI (genAI) company, to deliver personalized search results for consumers on Shopify merchants’ storefronts.

Our take: Reclaiming time and reducing risk for merchants helps position Shopify as a stronger commerce platform and partner. 

• SMBs operating on the platform benefit from removing the burden of tracking sales taxes for different states and can focus their efforts on expanding their geographic reach.
• Satisfaction with Shopify’s ecommerce solutions could also encourage cross-sell opportunities for things like Shopify’s POS system.