[OFBiz] Users - Sales Tax / VAT

[Mike Metcalfe]

Hi Ray,

I am very interested in your solution because here in South Africa we also
have VAT included in the price of a product.  We alos have categories, 0%
and 14%. I'm new to OFBiz and don't have much time to spend on it so I don't
think I'll be much help I'm afraid.

Regards
Mike



 -----Original Message-----
From: users-bounces at lists.ofbiz.org [mailto:users-bounces at lists.ofbiz.org]On
Behalf Of Ray
Sent: 06 May 2005 11:53
To: OFBiz Users / Usage Discussion (High Traffic)
Subject: [OFBiz] Users - Sales Tax / VAT


  Hi,

  Has anybody set up VAT (value added tax - basically sales tax in US terms)
in OFBiz using the UK principles? I'll outline the format we use outside of
OFBiz and would be interested in hearing if anybody has already set it up or
suggestions on modifications that could be made to put support for it into
the framework.

  We deal with 3 VAT categories (I'm sure there are more for other
industries):
  1) 0% - items like books are exempt
  2) 13% - books with audio tapes would fall into this category
  3) 17.5% - The normal VAT rate for all other products

  In the UK nearly all retail sales include VAT on the quoted price. So if I
see a ball for sale at £10 then that's what it will cost me at checkout and
the VAT will be listed as the proportion of the cost - £1.49, the cost of
the goods without VAT being £8.51.

  As an additional burden on the receipt the VAT will be shown for each
category, for example:
      1 x My Favorite Book                                    £5.99
      1 x My Favorite Book with audio reading       £8.99
      1 x Ball
£10.00
                                                     VAT
            ( £2.52 )
                                                    Total
£24.98

      VAT rates:
              0%       £0.0      of    £5.99
             13%      £1.03    of    £8.99
             17.5%   £1.49    of    £10.00

  Different organisations can claim the VAT back when doing their accounts
so the information is essential for them to process those claims. Obviously
formats of receipts vary from place to place so this is only for
illustration of the principle.

  I have tested that OFBiz can handle the different categories for products
and it works fine applying relevant rates to the products. The problem (or
question) is related to entering prices including or excluding tax. We are
using the price field types LIST and DEFAULT with both values invariably set
to the retail price i.e. £10.00  if the item goes on sale we might change
DEFAULT to say £8.00 or set up a price rule. The important point is this
value includes the VAT so any further VAT figures should only be showing the
proportional value of VAT in the product price not adding it as VAT.

  Would it be acceptable to add another flag to the SimpleSalesTaxLookup
entity that specified proportional only rates (prices include tax already),
then other changes above that to use the flag? Or would it make more sense
to have a something else on the price entity to indicate including tax? I
know I can change my system to get it working how I want, but I'd rather do
it with a view to adding it back into the framework so others can make use
of it.

  For the separate rate reporting maybe a flag like the order item explode
could be used to turn it on and off?

  Thanks,

  Ray


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