Beverage container tax / Deposit Fee

July 12, 2023

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In certain jurisdictions, specific items may be charged a flat tax. Good examples would be a bottle deposit, or the nicotine tax in North Carolina. 

For any tax that is charged not as a percentage of the net sales price, but based on the quantity of the item sold, Erply has a feature called “Beverage Containers” or "Deposit Fee".

Creating Beverage Container / Deposit Fee items

You will need to create a new non-stock item for each tax that needs to be applied.

 

For example, say you have products that have a $5 tax and products that have a $10 tax. 

You would create two items: 

  • One named “Five Dollar Tax” with a price of $5
  • One named “Ten Dollar Tax” with a price of $10.

 

Note: Non-stock products can be created under the PIM Module. They do not hold stock, so they do not have an inventory to count.

We also recommend checking off the “tax free in all locations” for these new tax items. Most places that require these flat “Beverage Container” tax rates do not charge state sales tax on other taxes.

Applying Beverage Container taxes / Deposit fees to items in Erply

Open the product card for the item that needs to be taxed. The card presents two fields needed here (in the left panel for Berlin BO):

Deposit Fee: Allow you to select the tax item to apply to the item you’re working with. 

Fee Quantity: The quantity of the tax item that should be added to the sale for each of the item you’re working with. Most often this will be 1.
 

 

Example of Fee Quantity > 1

Depending on legal requirement you may need to use a Fee Quantity >1.
For example, some jurisdictions tax nicotine-containing product based on the nicotine amount.
In that case:

  • The Deposit Fee would be a non-stock item with a price corresponding to the tax per nicotine unit.
    Let's say $1 per 1mg of nicotine
  • For each item subjected to the tax, the Fee Quantity depends on the nicotine content.
    Let's say for a product containing 2mg of nicotine, we would set Fee Quantity = 2

Importing Beverage Container / Deposit fee settings

The product importer allows to import or update beverage container information, by mapping 2 columns from your import file to:

  • Product Deposit Fee Code: needs to be the (unique) product code of the non-stock item representing the beverage container tax or deposit fee
  • Product Deposit Fee Amount: needs to be a number for the quantity of beverage container tax / deposit fee that needs to be added to the sale whenever the taxed item is sold

Selling items with Beverage Container taxes / Deposit fees with Erply POS

You can sell the items subjected to a beverage container tax / deposit fee by adding them to the POS cart like any other item.
When an item is set with a Deposit Fee, the non-stock item for the fee will automatically be added to the cart alongside the taxed product, in the configured quantity, and nested under it.
Note that the product subjected to a deposit fee may still be subjected to sales tax, depending on the tax rate setting for this item.