Product Line Setup - Tax field descriptions

Use to assign the Country of Origin; that is, where a product was manufactured, produced, or grown. When used in conjunction with an HS Code or tariff code, it further defines the criteria for a particular rate. You can set up Country codes in SA Table Code Value Setup.

This field can be used to assign HS Codes or other kinds of tariff codes to a product. A harmonized tariff code is part of the Harmonized Commodity Description and Coding System that was created by the World Customs Organization (WCO). The HS system uses a logical nomenclature method to categorize goods into approximately 5,000 commodity groups. Countries often assign customs duties based on the harmonized tariff code of the product. You must set up the HS Code in SA Tariff Rate Setup.

You can set up a default Non Tax Reason for this product line in this Product Line Setup - Tax window.

If the warehouse product is non-taxable, you can specify a Non Tax Reason. The Non Tax Reason values are set up in SA Table Code Value Setup. The reasons are defined by you and should describe why the warehouse product is non-taxable. If a reason exists, Sales Order Entry stores it on the line item for this product.

When you select a valid Non Tax Reason, the non tax reason description is displayed to the right of the field.

Set up a default in Product Line Setup - Tax. When you specify the Vendor and Product Line values in Product Warehouse Product Setup-New, the data on the Product Line Setup record that matches the vendor and product line is used to populate the corresponding fields on the new Product Warehouse Product Setup record. This ensures the initial data for any new Product Warehouse Product Setup record associated with that product line is created with the same default data. This speeds up the creation of the record because you have less data to specify on a new record.

A user-defined field that allows you to group products for taxing purposes. This field is used with the State, and possibly Customer and Ship to fields in SA Exemption Table Setup, to determine the taxability of the product and customer combinations. This field allows you flexibility in accounting for taxes for customer, product, ship-to, and locality combinations.

Set up a default in Product Line Setup - Tax. When you specify the Vendor and Product Line values in Product Warehouse Product Setup-New, the data on the Product Line Setup record that matches the vendor and product line is used to populate the corresponding fields on the new Product Warehouse Product Setup record. This ensures the initial data for any new Product Warehouse Product Setup record associated with that product line is created with the same default data. This speeds up the creation of the record because you have less data to specify on a new record.

Note: If you use Sovos GTD, you can specify a Sovos GTD product code so the STEP module uses the tax rules assigned to this product in all jurisdictions. Refer to your Sovos GTD Product Code User Guide for a list of product codes.

Tax Groups are special codes that identify special taxing needs. They are product- or addon-related. A tax group allows you to address the taxing needs of a product (such as a luxury tax, a hazardous waste tax, or a tax exemption) or an addon (such as freight and handling). Some tax group names may be dictated by a third-party tax software product codes or by Canadian taxing.

In Sales Use Tax (embedded with Distribution SX.e), tax groups are used in conjunction with company, product/addon, customer, sales, and tax records to calculate and apply the appropriate tax during sales order entry, and to update General Ledger. Therefore, tax groups must be set up correctly to ensure the tax groups are available to the other modules and that calculations are accurate.

Tax groups 1-5 are set up in SA Company Setup. Expanded tax groups 6-99 can be set up in SA Table Code Value Setup-Tax Groups, but are primarily for industry taxes.

Initiate the setup of tax groups 1-5 in SA Company Setup. Tax Group Name 1 must be named and created first and should establish a base of taxing information. The first group of rates must always be the standard rate applied to the majority of items or purchases. Name the standard group in SA Company Setup, then define the standard master, amounts, rates, and taxing jurisdiction in SA Sales Use Tax Setup.

The taxable status of customers and products can be established as Taxable, Non Taxable (exempt), or Variable Based on Customer. The taxable type specified as the default in Customer Setup-Taxing, Customer ShipTo Setup, and Product Warehouse Product Setup-Taxing, together with the SA Exemption Table Setup record determines the taxable status of each order entered in Sales Order Entry. The system automatically calculates taxes for sales orders and purchase orders.

See taxable status.

Note: If you use Sovos - SUT, select the Taxable option if you are using Sovos - SUT products. This instructs the Sales and Use Tax System to use its own tax tables and exemption records to determine the tax liability for this product line.