Configuring a Luxury Tax (Retail Sales Items Only)
Luxury items can be targeted to apply an additional sales tax based on their price and the configured threshold amount in the Tax Rates module. Only the amount beyond the configured threshold is taxed. This luxury tax is currently only supported for retail sales items (not for food and beverage items).
Example
A jacket costs 200.00. The law states items with a price of over 175.00, must then be taxed with an additional 10% tax.
Table 15-6 Breakdown of an Applied Luxury Tax Item
Line Item | Calculation | Taxable Amount | Total |
---|---|---|---|
Jacket |
200.00 |
||
Taxable Amount |
200.00 minus 175.00 |
25.00 |
|
Tax |
25.00 x .10 |
2.50 |
|
Total Due |
202.50 |
To configure a luxury tax:
Parent topic: Taxes