Don't Add Any Tax on Sales Orders
Set up your environment so Order Management doesn't add any tax on the sales order.
In some instances you might not want to include any tax on your sales order. For example, you sell to a nonprofit organization that doesn't pay sales tax, you sell to a wholesaler who doesn't pay sales tax because they charge tax to their retail customers, or you charge tax according to the delivery address but the tax authority at that location doesn't charge sales tax.
Summary of the Setup
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Create the factor set.
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Create the condition set.
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Create the tax rule.
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Test your set up.
Assume you already set up the US_TAX_REGIME tax regime, the STATE1 tax, and the STANDARD tax status code when you set up tax for the customer site. For details, see Apply Tax According to Customer Site.
Create the Factor Set
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Go to the Setup and Maintenance work area, then go to the task.
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Offering: Financials
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Functional Area: Transaction Tax
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Task: Manage Tax Determining Factor Sets
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On the Manage Tax Determining Factor Sets page, click Create.
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On the Create Tax Determining Factor Set page, set the values.
Attribute
Value
Tax Determining Factor Set Code
FACTOR SET FOR NO TAX
Tax Determining Factor Set Name
FACTOR SET FOR NO TAX
Set Usage
Tax Rules
Tax Regime Code
US_TAX_REGIME
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In the Associate Tax Determining Factors area, set the values, then click Save and Close > Done.
Attribute
Value
Determining Factor Class
Transaction Generic Classification
Determining Factor Name
Transaction Business Category
Create the Condition Set
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On the Setup page, go to the task.
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Offering: Financials
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Functional Area: Transaction Tax
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Task: Manage Tax Condition Sets
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On the Manage Tax Condition Sets page, click Create.
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On the Create Tax Condition Sets page, set the values.
Attribute
Value
Tax Condition Set Code
CONDITION SET FOR NO TAX
Tax Condition Set Name
CONDITION SET FOR NO TAX
Tax Determining Factor Set Code
FACTOR SET FOR NO TAX
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In the Tax Condition Set Details area, set the values, then click Save and Close > Done.
Attribute
Value
Tax Determining Factor Class
Transaction Generic Classification
Tax Determining Factor Name
Transaction Business Category
Operator
Equal To
Value or Start From Range
SALES_TRANSACTION
Create the Tax Rule
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On the Setup page, go to the task.
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Offering: Financials
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Functional Area: Transaction Tax
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Task: Manage Tax Rules
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On the Manage Tax Rules page, click Actions > Create.
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On the Create Determine Tax Applicability Rule page, set the values.
Attribute
Value
Configuration Owner
Global Configuration Owner
Tax Regime Code
US_TAX_REGIME
Tax
STATE1
Rule Code
Rule for No Tax
Rule Name
Rule for No Tax
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In the Tax Determining Factor Set area, in the Code attribute, set the value, then click Next.
Attribute
Value
Code
FACTOR SET FOR NO TAX
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On the Create Determine Tax Applicability Rule page, in the Tax Condition Set area, set the values, then click Save and Next.
Attribute
Value
Tax Condition Set Code
CONDITION SET FOR NO TAX
New Condition Set Order
1
Result
Not Applicable
Enabled
Contains a check mark
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On the Edit Determine Tax Applicability Rule page, in the Rule Status and Order area, add a check mark to the Enabled attribute, then click Submit > Done.
Test Your Set Up
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Go to the Order Management work area and create a sales order.
Attribute
Value
Customer
Computer Service and Rentals
Business Unit
Vision Operations
Ship-to Address
2164 Broadway, Tempe, AZ, 85282
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Add an order line.
Attribute
Value
Item
AS54888
Quantity
1
Amount
2,500
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Click Actions > Reprice Order.
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Click the total at the top of the sales order, then verify that there's no tax.
The tax line should contain a value of 0 or there should be no tax line at all.
Attribute
Value
Total List Price
2,500.00
Discount
0.00
Total Net Price
2,500.00
Shipping
0.00
Total Credit
0.00
Pay Now
2,500.00