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Joined: 4/17/2012
Posts: 10
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Hi,
I noticed that when someone purchasing something on our site and applies our coupon, the discount is deducted from the taxed total amount.
It shows this way:
Sub Total : $100.00
Shipping Fee : $0.00
Discount : -$10.00
Sales Tax 13% : $13.00
Total : $103.00
The display order is correct, it shows the discount then the sales tax, but actually the sales tax should be calculated on the discounted amount, which is $90.
It should be:
Sub Total : $100.00
Shipping Fee : $0.00
Discount : -$10.00
Sales Tax 13% : $11.70
Total : $101.70
Thank you,
Steven
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Joined: 1/1/0001
Posts: 0
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Hi Steven,
Which version of the Cart are you currently running?
In your Cart Settings, how do you have the Shipping and Handling Setup section configured?
Which Tax Method do you have selected in the Tax Setup section?
When I tested this on our test portal, the Tax seems to have been applied correctly to the SubTotal, please see the following screenshot:
I may not have the exact same configuration as you though, please advise of the above and I will test and try to replicate.
Thanks,
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Joined: 1/22/2012
Posts: 26
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I seem to be having this problem with VAT/GST.
Currently on 6.01.02 of DNN and 5.00 of Smith Cart. I have VAT/GST selected in tax setup with a value of 10% and GST in the VAT/GST dropdown
When I enter the shopping cart I get the following which is correct
Sub Total :$129.50
Discount :-$0.00
Shipping Fee : $0.00
Handling Charge :$0.00
Member Discount % :
Total: $129.50
GST Included(10%) :$11.77
But when I apply a 10% coupon it changes to this.
Sub Total :$129.50
Discount :-$12.95
Shipping Fee :$0.00
Handling Charge :$0.00
Member Discount % :
Total: $116.55
GST (10%) :$9.54
The GST should be $10.60 or 116.55/11. It looks like the 10% discount is being added to the tax field as well.
Any help would be greatly appreciated.
Ian
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Joined: 1/22/2012
Posts: 26
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Any information with this one? Would like to go live tomorrow.
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Joined: 1/1/0001
Posts: 0
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Hi Ian,
I was able to replicate the same behaviour you described. I will check with programming and will postback to this thread with their response.
Thanks,
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Joined: 3/11/2010
Posts: 1979
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Depending on the jurisdiction, coupons may or may not reduce the sales tax which must be paid by the consumer. This is often determined by who sponsors the coupon. If the coupon is issued by the retailer, the product was never offered at the original price and the coupon represents a reduction in the amount paid and the tax. If the coupon is issued by the manufacturer, the original price is still paid but some of the price is covered by the manufacturer instead of the consumer and the full price remains taxable. This is the case with the coupon-eligible converter boxes in the U.S., which compensate in part for the forced conversion to digital TV. Mobile coupons have become very popular among US fast-food customers. The primary success factors for the SMS campaigns are discount size, how the discount value is framed (as a gift or percent off) and the timing of the campaign.
http://en.wikipedia.org/wiki/Coupon
As always there are alot of rules and exceptions when it comes to tax and the rules and exceptions vary by country, state, province and sometimes city. The way the cart is programmed to apply VAT/GST tax on the original subtotal and not the discounted subtotal is correct in some countries and tax jurisdictions. In order to support all b2b and b2c stores we will need to add a new cart setting that allows the store admin to configure the cart to charge tax on the non discounted subtotal or the discounted subtotal.
I will add this new feature to the Smith Cart dev roadmap. If you need this change completed right away and would like to sponsor a portion of the development please submit your quote request here https://www.smith-consulting.com/Services/RequestaQuote.aspx
Thanks,
Scott Kelly
Project Manager
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Joined: 1/22/2012
Posts: 26
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Thanks Scott
That's a bit disappointing and will be a bit of a barrier for us using the product in Australia which calculates GST on the discounted subtotal. I can sort of get around it by selecting no tax. This removes the incorrect tax amount from the screen. Unfortunately the order conformation is sent showing zero sales tax which would cause problems. There doesn't seem to be a way of removing this as it is part of the token used. If I could get around this it might be ok? Any thoughts on if that could be possible?
I haven't tried it yet but could you tell me if this would apply to member discounts as well?
Regards Ian
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Joined: 1/1/0001
Posts: 0
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Hi Ian,
I will check with programming regarding your tax scenario and will postback with an update if there is a solution we can provide. To hide the Tax field navigate to your Cart Settings > General Cart Setup section > enable the "Hide Tax" option. When enabled the tax charge on the Cart Page, Confirmation Page (Before Payment), Confirmation Page (After Payment), and all confirmation emails will be hidden.
If you use Member Pricing, you will need to load all product pricing inclusive of VAT/GST tax. During the cart checkout the confirmation pages and invoice VAT/GST is displayed as follows:
Sub Total : $30.00 Discount :-$0.00 Shipping & Handling :$0.00 Total :$30.00 GST Included (10%) :$2.73
The formula for the tax (VAT) is as follows: GST($) = Total($) * GST(%) / (1 + GST(%))
Hope this helps!
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Joined: 1/22/2012
Posts: 26
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Thanks Kevin
Here is a the totals from a shipping and order conformation when no tax is selected, (no tax line is shown on the screen). It seems that it shows sales tax as 0. 00 This is a problem because it is stating that there is no GST rather than not displaying it.
SubTotal: $222.00 Discount : -$22.20 Shipping Fee : $0.00 Handling Charge : $0.00 Sales Tax $0.00 Total $199.80
Regards Ian
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Joined: 1/1/0001
Posts: 0
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Hi Ian,
I just tested this and can confirm the same behavior. I have sent this issue into programming and will postback to this thread as soon as an update is available.
Thank you for reporting the issue.
Kind Regards,
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Joined: 1/1/0001
Posts: 0
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Following up on this old thread for anyone else reading. In the release of Cart 5.25, released on 11/26/12, we added a new Tax options called "Apply Tax Before Discounts" and "Apply Tax After Discounts" which allows you to choose if a discount is applied to the Sub Total or to the discounted total. More about these settings in the Kb article at the following link: http://helpdesk.smith-consulting.com/...
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