At 9.6% CAGR, North America Tax Software Market is Projected to be Worth US$ 14,184.69 Million by 2030, says Business Market Insights

According to Business Market Insights research, the North America tax software market was valued at US$ 6,788.67 million in 2022 and is expected to reach US$ 14,184.69 million by 2030, registering a CAGR of 9.6% from 2022 to 2030. Increase in digitization of tax systems and rise in adoption of tax software are among the critical factors attributed to the North America tax software market expansion.

The ongoing digital revolution presents enormous scope for businesses-digital services and automation help to modify business models and traditional processes for improving operational efficiencies and revenues. Digital transformation or automation in businesses is characterized by the integration of digital technology in various business processes, organizational activities, and business models. The digitalization of tax systems aids in enhanced operational efficiencies, end-to-end business process optimization, and cost and human error reduction.

Citizens mostly find the process of paying taxes challenging and time-consuming. The tax administration authorities are increasingly undertaking digital transformation and automation of their systems, as monitor tax compliance and collecting sufficient revenue is necessary to finance public goods and services. Digitalized tax systems have the potential to bring successful and sustainable tax reforms, ensure proper taxation, and address compliance-related challenges. Further, the COVID-19 pandemic, which led to a rise in the use of digital commerce, made digital transformation especially urgent for tax administrations. Companies are increasingly embracing tax digitalization to comply with new electronic reporting requirements and enhance the accuracy and efficiency of tax functions. The relevant investments by these companies in tax software technologies continue to rise to improve the ability to gather more tax information and gain more insights into the tax and financial positions of taxpayers. In May 2022, Central Square Technologies announced that six municipalities in Ontario, Canada, selected Central Square's Property Tax solution to amplify the citizen experience. Tax software quickly analyzes a client's overall financial situation and suggests insurance or investment products. It also provides services such as auditing, bookkeeping, and comprehensive financial plan preparation. The tax preparation process has become faster and more efficient as vast information is now available in digital format, which helps tax preparers directly import their client data from personal finance software in a single click. This has eliminated the need for manual entries. Sage Group plc, Xero Limited, SAP SE, and Cloud Tax are among the key tax software vendors operating worldwide. Further, mobile apps are available now for taxpayers, which help them effortlessly e-file their taxes. Thus, the continuous digitization of the tax system propels the growth of the tax software market.

On the contrary, high software and training cost hampers the growth of North America tax software market.

Based on product, the North America tax software market is bifurcated into software and services. The software segment held 84.8% share of North America tax software market in 2022, amassing US$ 5,758.05 million. It is projected to garner US$ 12,370.14 million by 2030 to expand at 10.0% CAGR during 2022-2030.

In terms of deployment type, the North America tax software market is bifurcated into cloud and on-premise. The cloud segment held 76.1% share of North America tax software market in 2022, amassing US$ 5,167.11 million. It is projected to garner US$ 11,237.55 million by 2030 to expand at 10.2% CAGR during 2022-2030.

Based on tax type, the North America tax software market is segmented into sales tax, income tax, corporate tax, and others. The sales tax segment held 46.1% share of North America tax software market in 2022, amassing US$ 3,130.97 million. It is projected to garner US$ 5,892.72 million by 2030 to expand at 8.2% CAGR during 2022-2030.

Based on end user, the North America tax software market is bifurcated into commercial enterprises and individual. The commercial enterprises held 79.6% share of North America tax software market in 2022, amassing US$ 5,402.70 million. It is projected to garner US$ 11,094.94 million by 2030 to expand at 9.4% CAGR during 2022-2030. Further, commercial enterprises segment is categorized into enterprise size (large enterprises, medium enterprises, and small enterprises) and vertical (IT and telecom, retail, BFSI, government, healthcare, and others).

By country, the North America tax software market has been categorized into the US, Canada, and Mexico. Our regional analysis states that the US captured 84.8% share of North America tax software market in 2022. It was assessed at US$ 5,754.08 million in 2022 and is likely to hit US$ 12,201.56 million by 2030, exhibiting a CAGR of 9.9% during 2022-2030.

Key players operating in the North America tax software market are Sage Group Plc, Thomson Reuters Corp, Xero Ltd, IRIS Software Group Ltd, Wolters Kluwer NV, Intuit Inc, HRB Digital LLC, Wealthsimple Technologies Inc, SAP SE, and CloudTax Inc, among others.

•    In August 2023, Right Networks, offering the only intelligent cloud purpose-built for accounting firms and professionals, announced a new partnership with Thomson Reuters, a global content and technology company, to offer cloud hosting of its tax and accounting solutions in the United States.
  
  
•    In July 2023, Thomson Reuters plans to invest US$100 million per year in artificial intelligence starting next year, with plans to integrate the technology in its tax research and tax preparation systems as well as other areas.
  
  
  

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