For years, tax compliance teams have wrestled with one of the least glamorous but most complex parts of business operations—manually mapping product codes and data structures to ever-evolving tax rules. Sovos, known as the “always-on compliance company,” thinks it has an answer.
The company today unveiled a major expansion to its Sovi™ AI Tax Compliance Cloud, adding two core capabilities—product tax code classification for Sales and Use Tax (SUT) and automated data mapping for VAT filing. Both use machine learning to handle processes that historically devoured staff hours and introduced compliance risk.
The result? Faster onboarding, fewer errors, and a significant leap toward fully autonomous tax compliance.
Automating the Heart of Tax Compliance
In tax compliance, product classification sits at the foundation of every transaction—dictating how each product or service is taxed. For global companies managing thousands of SKUs across multiple systems, that’s a herculean task.
Traditionally, teams had to manually review product attributes, map them to tax codes, and repeat the cycle every time regulations or product catalogs changed. Sovos’ new AI-driven classification changes that dynamic.
Using machine learning models trained on product attributes from ERP and ecommerce platforms such as SAP, Oracle, and NetSuite, Sovi AI automatically recommends the correct tax codes with confidence scores. High-confidence results can be approved and processed instantly, while edge cases surface for human review.
The AI doesn’t just apply rules—it learns them, continuously adapting to new tax updates and data variations across global jurisdictions.
As Sovos CEO Kevin Akeroyd put it:
“We set out to reexamine how compliance is managed inside an organization—identify inefficiencies, eliminate redundancies, and create scalable processes. The latest Sovi release replaces manual and mundane tasks with tax compliance intelligence that learns, adapts, and flexes to customer needs.”
AI-Driven Data Mapping: Goodbye to Manual File Reviews
If you’ve ever onboarded for VAT filing, you know the grind: endless spreadsheets, manual field mapping, and rework every time a data structure shifts.
Sovi AI aims to make that a relic of the past. Its automated data mapping feature can interpret source data, recognize fields, and align them with compliance-ready formats—eliminating the usual “back-and-forth” between clients and compliance teams.
When tax regulations evolve or new fields are required, updates can be made dynamically via AI rather than reconfiguring integrations from scratch.
Swati Garodia, Sovos’ Chief Product Officer, framed it as a practical step toward intelligent compliance:
“By embedding Sovi AI into core workflows, we’re reducing dependency on manual resources, increasing accuracy, and helping customers stay one step ahead of evolving tax rules.”
A Broader Push Toward Autonomous Compliance
The new capabilities strengthen Sovi AI’s role as the intelligence layer across Sovos’ Global Tax Determination (GTD) and VAT Filing Services.
- For GTD users: AI classifies thousands of products quickly, eliminating bottlenecks during product launches or tax updates.
- For VAT Filing customers: AI accelerates onboarding and ensures data is always aligned with regulatory requirements—without manual intervention.
The expansion reflects a broader industry trend toward autonomous compliance, where AI doesn’t just assist human teams—it becomes part of the compliance fabric itself.
Competitors like Avalara and Vertex have also been experimenting with AI for indirect tax, but Sovos’ move to embed machine learning at the data and classification level pushes automation deeper into the workflow than most rivals currently offer.
Why It Matters Now
Tax compliance is moving from an operational headache to a strategic data challenge. With governments worldwide mandating real-time reporting and e-invoicing, errors in tax coding can trigger fines, audits, and reputation risks.
By training models to understand products, map data, and detect anomalies, platforms like Sovi AI promise not just faster compliance—but more resilient governance as rules change across markets.
And for enterprises managing omnichannel sales and AI-powered operations, every hour saved on compliance is another hour spent on growth.
Early Access and Availability
The new tax code classification and data mapping capabilities will be available to early adopters in December 2025, with broader rollout expected in 2026. Sovos says the goal is to continue expanding Sovi AI’s footprint across all compliance workflows—from tax determination to global reporting and analytics.
The Bottom Line
Sovos isn’t just automating tax—it’s redefining how compliance intelligence operates inside the enterprise. With this expansion, the company is turning AI into a core part of compliance infrastructure, giving organizations a way to cut manual work, boost accuracy, and stay compliant across jurisdictions that never stop changing.
In an era of complex, data-driven taxation, Sovi AI may be the most compelling proof yet that even compliance can get smarter.
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