Separate Tax vs. Total Tax Calculations
9/30/2004 - Article ID#: K000181
||Separate Tax vs. Total Tax Calculations
When taxes are calculated on a reservation, they may consist of
multiple tax percentages. For example, the tax rate for a room in Vail may
consist of 8.5% sales tax for the county, 6.5% sales tax for the state.
The total tax is 15%, but RDP systems do not use 15% to calculate the tax,
instead the 8.5% and 6.5% are used individually. For
example, using a $99 room rate and our sample tax percentages we get the
|Tax 1 %
||$6.435 or rounded = $6.44
|Tax 2 %
||$8.415 or rounded = $8.42
|Total of Tax 1 + Tax 2 Amounts
|Total Tax %
||Incorrect Amount: $14.85
Taxes must be calculated individually, so when that liability is paid to the
state or county, the amounts are correct. In some cases, up to 4 taxes are
collected, so the tax amount could differ by more than just one cent.
Taxes are also calculated for each day, rather than the entire stay and this may
also account for descrepancies in tax calculations.
Taxes are entered into the system in the C7 table. The individual tax
percentages can be viewed there.
Customers should put on their folio or registration cards the
individual tax amounts rather than the total tax percentage. This will
avoid customers calculating the taxes incorrectly.