Tax Classes
Depending on the countries where your business operates, you need to configure relevant tax classes.
Here you can find an overview of the Emporix API Tax Service, along with its features and benefits.
Purpose
Based on where your business operates and what types of products you sell, the rates of sales tax may differ. The Emporix Tax Service provides the APIs to help your business cover diverse tax scenarios.
Tax classes are required to set product prices. In order to define a price for an item, you need to have a tax class configured first. You have to define a tax class for each tax rate and for each country you operate in to determine correct tax calculation according to the given country's regulations. Then, when setting a price for a product, you need to select the correct tax class for a given country and apply the price for a given site. The system calculates the due tax based on the defined tax classes for the countries you sell in.
For example, on your site you sell books worldwide. In Germany, books are taxable according to REDUCED tax class of 7% tax rate. In Ireland, the biding IE-ZERO tax class for books is with 0% tax rate. So the gross price for a book in each country is calculated according to the chosen tax classes for the product.
Similarly, tax classes are used in calculating shipping costs or fees, so you need to define a tax class designated to the shipping and other fees your charge, for each country you deliver your goods to. In other words, you need to define the tax classes to properly manage prices, display them on the storefront and to enable proper calculations in the cart and checkout.
Features
The Tax Service API introduces a set of features that make tax management easier:
Automatic calculation of prices
You can automatically calculate net and gross values for prices. See more in the Automated operations section.
Customizable tax configurations
You can create your own tax configurations and adjust them to your business's needs. See more in the Tax class modeling section.
Overview
Tax class modeling
To minimize data redundancy, tax classes are defined in separate, country-specific configurations and then referenced in applicable products.
You can manage your tax configurations through the Emporix Tax Service or you can also define them directly in the Management Dashboard, in the Settings -> Tax module. Learn more in the Tax documentation.
You can create as many tax configurations as you need. Each configuration can be described with the following attributes:
Country code Tax class:
Code
Rate
Tax class:
Description
Name
Order on the tax class list
Based on the defined tax classes, here's the example pricing:
Book A
EUR 20.00
Germany (DE)
Reduced:
Tax Code: REDUCED
Tax Rate: 7%
EUR 21.40
Book A
EUR 20.00
Ireland (IE)
Zero:
Tax Code: IE-ZERO
Tax Rate: 0%
EUR 20.00
Explanation:
Base Price: Price of the product before tax.
Tax Class: A category that groups products with similar tax treatments
Tax Code: A unique identifier for the tax class in each country.
Tax Rate: Percentage of tax applied to the base price.
Final Price: Calculated as Base Price + (Base Price × Tax Rate).
Decide how the product prices are displayed on your storefront. Specify whether all the product prices are shown as gross or net values by updating the given site's includesTax parameter. The true value means that the site displays gross prices, while the false value means the net prices are visible. If the includesTax parameter for a site is not defined, the system defaults to the includesTax value specified at the given price model level.
Learn more in the Site Settings API and in the Price Service API documentation.
Automated operations
To facilitate your custom implementations of additional B2B workflows, the Tax Service API supports conversion operations for prices. For that purpose, you can use the Tax calculation endpoint. As an input in the request, you can provide a specific price value, specify the includesTax parameter, and provide a source and target tax class. Based on these, in the response you get the calculations of gross, and net price values, tax value, or a price calculated for another country (using a different tax class). The calculations might be helpful in your custom implementations.
Note that the Tax Service allows for calculations that are based on specific values you provide. If you want to make calculations based on the Price object, you should use the price matching mechanism of the Price Service.
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