How tax works in Imonggo Ecommerce

Charging tax is quite complex in Imonggo Ecommerce, so please follow along as we explain it step-by-step.

Steps to set up taxes in Imonggo Ecommerce

For the purpose of this tutorial, let’s pretend we have a business called MegamixMart, a department store that sells goods online.

Now MegamixMart services two Zones: MoonLand and SunLand. Then there’s such a tax called Entertainment Tax for toys and games. The two different Zones have different rates for it.

Learn how to set up Zones.

MoonLand charges an Entertainment Tax of 10%, while SunLand only has an Entertainment Tax of 5%.

You have to create these two tax rates by going to Settings > Tax Rates.

Create a Tax Rate by clicking the New Tax Rate button.

On the next dialog box, enter the following:

Name – The name of the tax rate
Rate – The rate of the tax (expressed in decimal form)
Zone – The zone where the tax will be applied
Included in Price – Check this box if you want to tax to be inclusive.
Show Rate in Label – Check this box if you want the tax rate to show up to the customer, along with the amount of tax.

Then click the Save button.

Next, create SunLand’s Entertainment Tax of 5%.

Learn how to set up Tax Rates.

Now that you have created the Tax Rates, you have to group them together under one Tax Code.

Go to Settings > Tax Codes. Create a tax code by clicking the New Tax Code button.

On the next dialog box, enter the following:

Name – The name of the tax category (required)
Tax Code – You can input any code that corresponds with this tax category
Description – You can input the description of this tax category here
Tax Rates – Enter every related tax rate. Here we added the Sin Tax for MoonLand and the Sin Tax for SunLand.

Then just click Save.

Learn how to set up Tax Codes.

Now you need to attach the tax code to the products.

Go to the Products tab. Edit the product by clicking the name. Let’s edit a toy item called Mario Lego.

Click the Tax Code field to add the Entertainment Taxes tax code, then click Save.

What does this do? Because you have applied Entertainment Taxes to Mario Lego, both the tax rates under this tax code have been applied to the product. If you can remember, they were these two tax rates: the 10% Entertainment Tax for MoonLand, and the 5% Entertainment Tax for SunLand.

But how does this work in the online store itself?

Upon purchase, the store asks the customer to input their address. Imonggo Ecommerce will then match that address to the Zone, and compute the tax of the item according to that related Zone.

For example, if the customer is in MoonLand, the Entertainment Tax is 10%.