• Resolved chelder86

    (@gmh2000)


    Hi!

    I’ve configured Woocommerce as ” Yes, I will enter prices inclusive of tax”. Screenshot: https://d.pr/i/50edWi

    To simplify my question, let’s look the main currency only (EUR). The discounted price (including taxes) is 59. Screenshot: https://d.pr/i/BucZ8i

    If I understood well, as the price includes taxes, it should NOT change no matter or where I am.

    Unfortunately a different price is shown depending of the shipping address. For example for Poland (on the checkout page), the price is not 59 but 59,98€ (includes 11,21€ VAT estimated for Poland). If I change the address to Serbia, it changes to: 48,76€

    Important note: prices are shown correctly if I’m logged on WordPress (/wp-admin).

    • if logged, price is shown correctly: https://d.pr/i/BzV9JQ
    • if not logged (incognito window), price is wrong: https://d.pr/i/RUsQz5
    • So how to show 59€ final price (including taxes) for everybody no matter the country?

    • This topic was modified 4 years, 1 month ago by chelder86.
Viewing 4 replies - 1 through 4 (of 4 total)
  • Phil

    (@fullysupportedphil)

    Automattic Happiness Engineer

    If I understood well, as the price includes taxes, it should NOT change no matter or where I am.

    That is incorrect.

    When showing pricing that is inclusive of tax, it means that the tax rate is built into the final price that is displayed to the customer.

    That does not mean that the same price will be charged regardless of if there is tax on the product or not. This also applies for different tax rates.

    When using inclusive pricing and various tax rates, your base tax is used as a benchmark. Taxes that are more than that have their prices adjusted so that you aren’t selling the actual product for less.

    The reason for this, is that the method that you described can lead to undercharging customers and potentially selling products at a loss depending on your margins.

    For example, say your cost on a product is $90.
    You sell the product with a 10% profit margin and use a base tax of 5%.
    This means normally you would set the cost of the product to $105 ($5 for tax, $10 profit).

    Now you add another tax rate in and it’s 15%.
    If you were to applied the method you mentioned and display the same price, you are no longer making 10% profit on this sale. In fact, you only make $1.5.

    With different tax rates and profit margins this could actually lead to you selling your products for a loss.

    If you want to display the same base product price regardless of the tax that is being applied, you’ll want to enter and display your pricing exclusive of tax. This way the product price will be displayed the same to everyone. Then your site can show the taxes as an separate line item.

    Thread Starter chelder86

    (@gmh2000)

    Thanks for your answer and clarification!

    I understand your point, but it also true that a price of 60€ is MUCH less attractive than 59€. And we just realised that a lot of customers are not seeing 59€ but 60€. Coincidence or not, we are selling much more on the 59€ country…

    We don’t want to charge customers and extra (VAT) on checkout. So showing the prices without VAT is not a good option for us :/

    So after knowing the risks you explained: is it possible to show the same final real price that the customer will pay (so with taxes included) somehow?

    Thanks

    Carlos

    Thread Starter chelder86

    (@gmh2000)

    This behaviour would explain why setting prices in other currencies manually is NOT working either if it’s configured as:

    Calculate tax based on: Customer shipping address.

    I notified to WPML support team here: https://wpml.org/forums/topic/set-prices-in-other-currencies-manually-not-working-2/

    The solution they proposed is to set it to: Shop base address.

    Phil

    (@fullysupportedphil)

    Automattic Happiness Engineer

    Hey Carlos,

    I wouldn’t be able to comment on the price rounding based on language, as that is a feature that WPML adds, that’s not from WooCommerce itself.

    That being said, if you set your taxes to calculate based on your shop’s address it would certainly change the way this works.

    Ignoring WPML and it’s currency conversion feature for a moment. If you were just using WooCommerce and set your taxes to calculated based on your shop’s address – it means every customer would be charged the same tax rate regardless of where they live. This may not be what you want, as you likely want to charge a different tax rate based on the customer’s location.

    Using your original example, customers from Poland and Serbia would both be charged the same tax rate. That rate would be whatever matches your store’s address in your tax table.

    So using WPML’s currency conversion option, the prices should stay the same regardless of their country, since the tax rate isn’t changing.

    To answer your following up question, in WooCommerce it’s not possible to charge customers different tax rates, yet keep the tax inclusive display price the same. Either the rate will adjust for the reasons I mentioned in my earlier reply. Or you would need to display the product price exclusive of tax.

    The only way to do what you described would be to use a third-party plugin or custom code to change the way that WooCommerce normally works. I’m not sure if WPML has options to allow you to override this (I’m guessing not, since they recommended using your shop’s based address for tax collection). If not, you may want to take a look at sites such as https://www.coedable.io for a skilled third-party developer.

    I hope that this gets you pointed in the right direction ??

Viewing 4 replies - 1 through 4 (of 4 total)
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