Select Page

Oracle E-Business Tax (EBTax) Status is Critical to Tax Success

by | May 4, 2018 | Oracle EBTax, Sales Tax, VAT/GST

Status is about groups for E-Business Tax EBTax

Status is about Grouping: Platinum, Gold or Silver

So how do you best think of Status? Well, think of Status like any other status. Are you Platinum, Gold or Silver points Status at Marriott?  What is your immigration status Citizen, Resident or Illegal Alien?  That is the status of the traffic light? Red, Yellow or Green when you slide through in front of the patrol car. So you get it. Status relates to the condition that a thing is in at a given time.
So for Tax think about goods and services. When thinking about goods and services think that you can group these goods and services into classifications or shall we say categories. And if the legal body that governs tax mandates that category A is taxed in a manner that is different than category B you could use the reference the governing body uses to describe the “status” of the category. So if we concluded that 80% of things belong to a group we call standard then we can call that the  “Standard” status. And then we can list out the variations from the “Standard” status in other ways and group them accordingly.
So the tax authority could conclude that they need a group that is clearly not even considered for a tax and then call that group Exempt or exempt status.  Then they could conclude for some current economic benefit that there should items included in the tax laws but establish this group with a Zero Status. Lastly, the tax authority could further group stuff in such a way that it is not exempt, nor zero nor standard but perhaps a reduced status.
So with status, it is ALL about grouping in accordance with what the tax authority i.e. the LAW says things should be grouped as. So the first thing you do is to determine how many different ways the LAW groups stuff and the number of groups they form will be equal to the number of

Status in Practice

So what happens in practice is we use Statuses (usually from a non-standard perspective) in Rules. We create these things that Oracle affectionately calls Tax Condition Sets (TCS) (ugly right?) and we map non-standard product/purchasing categories (read about them this article)  on a one for one basis to a matching TCS (not the consulting company.)
The TCS’s, say 130 of say 350-400 categories, would be used in Status Rules to deviate the tax from the default (Standard Status)  to whatever outcome (status/group) that the category is related to.
As new Categories are added from time to time. So Categories (be it Product, Purchasing or Inventory) get analyzed by the Tax Dept up front.  Sometimes the Tax depart goes to outside counsel to get a ruling of sorts on the proper tax outcome for a particular group/type of products.
Naturally, you can spend all day looking at Oracle guides and doing training at Oracle U but if you don’t know what to the pieces of the puzzle are for and how they fit into the larger picture all the configuration skills in the world will get you nowhere.
So that is what this article the sister articles I have put forward are for. To give color and context to the pieces of EBTax that make up the tax solution puzzle.

Get Started Now!

We will get in touch with as soon as possible

Thanks for signing up!