VAT Reclaim Firm Releases Foreign Tax Refund Software

A new software product that records the value-added tax levied during international conference or trade show registration is likely to ease the process of VAT reclaim for U.S. companies.

Under international tax law, travelers can reclaim some percentage of the VAT levied by the host country, although the process can be so unwieldy and intimidating to the uninitiated that many U.S. companies let thousands of dollars go unclaimed.

Hoping to address what it believes is an underserved market, Seattle-based Corporate VAT Management will distribute a software application called Auto VAT Meeting to a select list of U.S. trade show organizers that host events in the United Kingdom, Sweden, the Netherlands and France.

The software company and reclaim firm, which rolled out the product earlier this month, will decide which firms will be targeted later this spring. So far, Reed Exhibition Group in London will offer the service during its 1997 Cable and Satellite show, while France's International Trade Exhibitions Inc. will use it for Equip Auto 97, to be held in Paris this October. Trade Show Central, a Web developer in Wellesley, Mass., will feature the product on its Website guide of international trade shows and intends to enable downloading of the form.

For future distribution, Corporate VAT intends to look at companies that produce technology shows because they will be comfortable with the software, as well as those that frequently host European exhibitions.

The show organizers will distribute the software to their exhibitors and attendees during the enrollment phase. An extra five to 10 minutes to fill out the refund registration application (either in advance or on site) and an added expense of $5 will enable the eventual collection of a rebate from 6 to 20 percent of the cost of the product or service, depending on the country's rules. The software is available in Windows 3.1 and Windows 95 formats.

"We want this to be a painless process for the trade show organizers and the attendees," said Corporate VAT Management's director of sales and marketing, Mark Kotzer.

Kotzer estimates that about 150,000 U.S. firms do regular business in VAT-friendly countries and of those, about 100,000 are smaller companies that have no standard procedure in place to reclaim VAT in an efficient way. A 1994 Coopers and Lybrand study estimated that U.S. companies paid $1.5 billion in VAT and that while $500 million was available for recovery, only $100 million was actually recovered.

Because many of the expenses-including the cost of registration, hotel rooms and exhibit fees-are generally known in advance, the attendee can fill in much of the required information up front. Attendees can later submit invoices for additional applicable refundables including professional fees, business expenses, telecommunications charges and ad hoc exhibition costs. Corporate VAT Management will handle the rest of the filing procedure.