India’s growing presence in global trade is bringing a new challenge for exporters: keeping pace with tax and invoicing rules that are becoming increasingly digital and real-time. The government estimates India’s total exports of goods and services reached $860.09 billion in FY2025-26, up 4.22% from the previous year.
As more markets move towards electronic invoicing and transaction-level reporting, exporters are having to rethink how tax compliance fits into their finance and supply chain systems.
Speaking on this global shift, Imtiyaz Khatib, VP of Product Management at Avalara, explained that businesses are facing a strict new reality as compliance moves away from static paperwork towards real time validation. “A static digital invoice attached to an email is no longer compliant,” he said, noting that cross border data must now clear government validation servers in highly structured formats first.
The trend is already taking shape globally. The European Union’s VAT in the Digital Age (ViDA) reforms will introduce digital reporting requirements for cross-border business-to-business transactions from July 2030, based on mandatory electronic invoicing. The European Commission published its 2026 implementation work programme in May.
For Indian exporters, the challenge is managing different tax rules, product classifications and invoicing requirements across markets. Khatib said many businesses still depend on spreadsheets and manual processes to manage these changes, often leaving tariff classification to logistics vendors or incorrectly assuming a product’s tax rate will be identical across North America and Europe.
This reliance on manual workflows persists even as the industry faces intense pressure to modernize through artificial intelligence. An Avalara survey published in July 2026 found that 85% of Indian finance leaders faced moderate or significant pressure to demonstrate returns from AI agent investments. At the same time, the research found gaps in governance and internal controls.
Khatib said automation can help companies right at the point of sale or invoicing by calculating taxes, assigning Harmonised System codes and estimating landed costs earlier in the transaction process. By addressing this at the source, businesses significantly reduce the risk of immediate holds and delayed payments at customs.
He said finance leaders should also treat tax compliance as part of broader business operations rather than a back office function. “Finance leaders need to look at tax compliance not as an isolated back office task, but as a core part of business agility, delivery speed, and customer experience,” Khatib said.
As regulations continue to change, companies will increasingly need systems that can connect tax data with finance, logistics and other business applications, while maintaining human oversight for higher risk decisions.