[Koha] Prices and tax in koha (also send on koha-devel)

[BOUIS Sonia]

Hi,
I'm not very fast to answer but I'm still interested by the question so I will try to answer at Galen's questions and I hope that there'll be several answers.
- If you get quoted a price for an item, is that price inclusive or exclusive of tax?
It depends on the vendor : some are giving price including tax and other not. But they always do the same manner.
- Do you want to be able to account for taxes in a separate fund from the fund that pays for the main cost of the item?
No, in my library, we don't need that. But I think it's true in other institutions
- As a library, are there taxes that you would pay when purchasing items that subsequently get refunded at the end of the year?
No, we don't have any refund at the end of the year
- If a vendor gives you a discount, is the discount applied to the pre-tax price or the price that includes tax?
The discount is applied on price including tax
- What factors govern the tax rate that applies to a given item?
It depends on the origin of the vendor (France, European Union, Non European Union)

Your turn.. :)

Regards

Sonia BOUIS
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De : Galen Charlton [mailto:gmc at esilibrary.com]
Envoyé : mercredi 18 décembre 2013 17:57
À : BOUIS Sonia
Cc : koha at lists.katipo.co.nz
Objet : Re: [Koha] Prices and tax in koha (also send on koha-devel)

Hi,

On Wed, Dec 18, 2013 at 6:16 AM, BOUIS Sonia <sonia.bouis at univ-lyon3.fr<mailto:sonia.bouis at univ-lyon3.fr>> wrote:
So I wonder if a decision about the prices and a correction of all the tables in acquisitions isn't necessary...
My suggestion is to stock all the price including tax and to calculate the price in the budget and in all the displaying tables according to the preferences in the vendor. I think, all the scripts of calculation and the template for displaying tables have to be correct.

It could be a new goal for koha 3.16 or perhaps for koha 3.18...

This is an excellent question.  There are have been a number of bugs over the years regarding the calculation of taxes for acquisitions, including a number which are still open [1].

It's not an easy one to answer, though, at least in part.  The easy part is to say that list prices, effective prices, tax amounts, and vendor discounts should be handled consistently in all parts of the acquisitions module.  The not-so-easy part is to decide how.  For example, should an effective price as stored in the database be inclusive of tax or exclusive of tax?  I could see either approach working.

One of the tricky bits is that tax policy varies so much.  For example, in the U.S. prices are almost always quoted exclusive of any applicable sales tax.  If you want to know the price a library would pay for a book, it would be something like take the list price, subtract the vendor discount, then add the applicable sales tax -- though since the U.S. does not have a national sales tax, the sales tax rate you pay depends on things like where you are, where the book vendor is, and if you are subject to paying use tax in your home state.

I am not an acquisitions librarian, by the way, so it's entirely possible that I've got a detail wrong in the above paragraph.

Consequently, I propose that we expand this thread for users (or potential users) of Koha to weigh in on what their expectations are regarding accounting for taxes in acquisitions.  Some questions to get started:

- If you get quoted a price for an item, is that price inclusive or exclusive of tax?
- Do you want to be able to account for taxes in a separate fund from the fund that pays for the main cost of the item?
- As a library, are there taxes that you would pay when purchasing items that subsequently get refunded at the end of the year?
- If a vendor gives you a discount, is the discount applied to the pre-tax price or the price that includes tax?
- What factors govern the tax rate that applies to a given item?

[1] E.g., 3980, 10613, 11062, 2865.

Regards,

Galen
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Galen Charlton
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