[jira] [Commented] (OFBIZ-6576) Pricing error in Variant Products when setup with VAT-Tax and price set on Virtual Product

[Nicolas Malin (Jira)]

    [ https://issues.apache.org/jira/browse/OFBIZ-6576?page=com.atlassian.jira.plugin.system.issuetabpanels:comment-tabpanel&focusedCommentId=15348053#comment-15348053 ]

Divesh Dutta commented on OFBIZ-6576:
-------------------------------------

Dear [~Peter Arnold] ,

You are right in terms of business definitions of VAT_TAX and SALES_TAX.

My comment was may be confusing, sorry for that. When I say that they are different I say in terms of how system will handle them in terms of Sales. In terms of sales, revenue is generated on product sales and sales tax is recorded as liability that needs to be remitted off. Same is the case with Vat tax. It should be recorded as liability. So I mean for system, both are liability and should be posted on general ledger accounts of liability nature. Currently VAT_TAX amounts are not recorded as liability when invoices are generated in OFBIZ. Here is the JIRA ticket for it: https://issues.apache.org/jira/browse/OFBIZ-7012

In OFBiz, there is only one place where if else is written for SALES_TAX and VAT_TAX and that ie for recording order adjustment and deciding type of orderAdjustment when sales order is recorded. So if Product's price have vat tax included in it, adjustment is recorded with type VAT_TAX else its recorded as SALES_TAX. That is it. So when invoice is generated for sales order, you want to record tax as liability in general ledgers. So it does not matter for system if its VAT_TAX or SALES_TAX . System should simply post tax as liability in case of sales. That is why I was saying that we can remove the if and else statements because its only at one place. However after thinking more, I agree that may be we should not remove the if and else because some countries collect both taxes, and for reporting point of view it will be helpful to track them separately.

In case of PO, sales tax is currently not calculated in OFBiz . User can manually add sales tax as order adjustment if user want to match total of PO near the invoice which supplier will send. When VAT is added in product' price and you place PO for those products, order total already have VAT included in it. And the total amount is just accounts payable for user. They don't want to separate out VAT amount here.

So as [~paul_foxworthy] was saying that difference is only in case of purchases because VAT applies to purchases as well, and your tax liability is reduced by the tax you have paid on purchases. So here I was saying that in case of PO, you can also add Sales tax manually in PO. And in that case, both the taxes are reducing the liability.  So this is not the actual difference between them IMO.

And you have already explained their actual difference in terms of business in very descriptive way . I hope my points are making sense. Issue in this ticket is already resolved. We were just discussing this additional thing for knowledge purpose :) .

> Pricing error in Variant Products when setup with VAT-Tax and price set on Virtual Product
> ------------------------------------------------------------------------------------------
>
>                 Key: OFBIZ-6576
>                 URL: https://issues.apache.org/jira/browse/OFBIZ-6576
>             Project: OFBiz
>          Issue Type: Bug
>          Components: product
>    Affects Versions: Release Branch 13.07, Release Branch 14.12, Trunk
>            Reporter: Peter Arnold
>            Assignee: Divesh Dutta
>              Labels: VAT
>             Fix For: 14.12.01, Upcoming Branch
>
>         Attachments: OFBIZ-6576.patch
>
>
> In a VAT-Tax setup (i.e. sales-tax does not apply) and when using virtual- variant- products and the price is defined only on the virtual product and with "Tax in Price" set to "Y", its variants should inherit the set price without adding any further taxes.
> This is currently not the case when in the e-commerce shop a variant product is added to the shopping cart. Currently sales-tax is added to the product price.
> Here is a detailed procedure to reproduce the error:
> In Party Manager:
> # Create new Party Group with Name "SII_CHL"
>     (Leave all settings for group creation as per standard)
> # Assign Role "Tax Authority" to party "SII_CHL"
> In Accounting Module / Tax Autorities:
> # Create New Tax Authority with following settings:
>     Geo:            CHL
>     Party:             SII_CHL
>     Include Tax in Price:     Y
>     Leave other setting as is
> # Under "Product Rates" create new tax with following settings:
>     Type: Value Added Tax
>     Tax Percentage: 19
>     From Date: Now
>     Leave other settings as is
> # Expire the Sales Tax created under tax authority _NA_ by setting its corresponding thru date to NOW.
> # Under Catalog Manager / Stores:
>     Modify following Settings for OFBiz Ecommerce Store (ID:9000)
>     Tax settings:
>     Show Prices with VAT tax included: Y
>     VAT Tax Auth Geo Id: CHL
>     VAT Tax Auth Party Id: 10000 (Or the Party ID corresponding to the created Tax Authority SII_CHL)
> # Expire all Promotions for OFBIZ E-Commerce Store [ID:9000] by setting all thru-dates to NOW
> # Under Catalog Manager / Products: Create New Product with following settings:
>     Internal Name: T-Shirt
>     Is Virtual Product: Y
> # Under Catalog Manager / Products / Categories
>     Assign the virtual product "T-Shirt" to the products category ID 200 (Widgets)
>      Product Category ID: 200
>       From Date: Now
>     Add
> # Under Catalog Manager / Products / Content
>     In override Simple Fields
>     Set Product Name to: "T-Shirt Virtual"
>     Update
> # Under Catalog Manager / Features:
>     Create New Feature Category.
>      Description: "T-Shirt Colors"
>     Submit
> # Create new Feature within feature Category "T-Shirt Colors":
>     Create New Feature
>      Feature Type: Color
>      Description: Red
>     Update
>     Create New Feature
>      Feature Type: Color
>      Description: Blue
>     Update
> # Create 2 variant products under the virtual product "T-Shirt"
>     Under Catalog Manager / Products
>     Find T-Shirt Product
>     Once T-Shirt Product is selected:
>     Press Features Tab
>     Under Add product features from Category or Group
>      Choose T-Shirt Colors Category
>      Feature Application Type: Selectable
>     Add
>     Screen with Blue and Red T-Shirt Colors appears.
>     Set for both colors From Date: Now
>     Sequence:1 for blue
>     Sequence:2 for red
>     Set a tick on each feature in order to select the feature for adding it.
>     Apply
> # Under Catalog Manager / Products with "T-Shirt" virtual product selected press the Variants
> tab
>     The Quick add Variants screen appears.
>     Define Product IDs for Blue and Red features.
>     Blue: T-Shirt Blue
>     Red: T-Shirt Red
>     Set tick on both features in order to select for variant product creation.
>     Create
> # Under Catalog Manager / Products / Prices set 2 new product prices for the created virtual
> product "T-Shirt":
>      Default Price
>      From Date: Now
>       Price: 11.9
>      Tax Percentage: 19
>      Tax in price: Y
>     Create
>      List Price
>      From Date: Now
>       Price: 11.9
>      Tax Percentage: 19
>      Tax in price: Y
>     Create
> Now the products should be visible in the E-Shop.
> The Virtual Products Price appears at USD 14.16 If I Select the blue or the red T-Shirt Price is 11.9USD
> Now I modify the Product Pricing on the Virtual Product.
>     On Default- and List- Prices add:
>     - Tax Percentage:    19
>     - Tax Authority Party (ID):    10000 (Or whatever ID corresponds to SII_CHL Party)
>     - Tax Auth Geo Id:    CHL
>         Update
> Back in the E-Shop on the product display now the correct prices appear.
> I.E. 11.9 USD for the virtual product, the red, and the blue shirt.
> Now I preselect the blue T-Shirt and add 1 to the shopping cart.
> If I go to the cart now the price of the Blue T-Shirt is 14,16USD.
> Now let's define a product price directly on the Red T-Shirt variant product:
> Under Catalog Manager / Product select the product "T-Shirt Red".
>     Under the Prices Tab:
>     - Price Type:    Default Price
>     - From Date:     Now
>     - Price:    11.9
>     - Tax Percentage: 19
>     - Tax Authority Party (ID): 10000 (Or corresponding ID to SII_CHL)
>     - Tax Auth Geo ID: CHL
>     - Tax in Price: Y
>     Create    
>     - Price Type:    List Price
>     - From Date:     Now
>     - Price:    11.9
>     - Tax Percentage: 19
>     - Tax Authority Party (ID): 10000 (Or corresponding ID to SII_CHL)
>     - Tax Auth Geo ID: CHL
>     - Tax in Price: Y
>     Create
> Back to the E-Shop
>     Select now the Red T-Shirt and add to shopping cart.
>     If you check the prices in the shopping cart the red T-Shirt would be sold at 11.9 USD and the blue T-Shirt at 14.16USD.
>     Only difference being that I have set up pricing directly on the Red T-Shirt, while the blue one gets its price from the virtual product T-Shirt.
> If you do the Quick Check out with a Chilean "Ship To" address and get to the "Final Checkout Review", you can see that for the Red T-Shirt no sales Tax is applied while for the blue one there is a sales tax of USD 2.26

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