GST accountant questions (was Re: Inventory and GST)

[Derek Atkins]

Bret,

are you offering to create this plug-in system you propose?

-derek

Bret Busby <bret at busby.net> writes:

> On Mon, 23 Jun 2003, marthter wrote:
> 
> > Date: Mon, 23 Jun 2003 01:30:51 -0400
> > From: marthter <marthter at yahoo.ca>
> > To: gnucash-user at lists.gnucash.org
> > Subject: GST accountant questions (was Re: Inventory and GST)
> > 
> > Err, I think the Mr. Osvald's "overcomplicating" of the question has 
> > been trumped by Mr. Busby's! :-)
> > 
> > 
> 
> <snip>
> 
> > 
> > p.s. An interesting spin on the "what is taxable?" question (hot chicken 
> > vs cold chicken, etc).  As I understand it, EVERYTHING in Canada is 
> > taxable, it is just that some things (like cold chicken and other 
> > groceries) are currently taxed at a 0% rate.  This was glossed over by 
> > the people who argue that essentials should not be taxed, yet it allows 
> > the government to raise the rate in the future with a mere federal 
> > budget announcement, rather than passing a whole new law through 
> > Parliament to change the definition of what is taxable.
> > 
> > 
> 
> My point, through all of what I said, is that, as I see it, there is no 
> easy solution for using GnuCash for GST accounting, in Australia. Your 
> Canadian system is yet another example of why I said that a solution for 
> Tax accounting, has to necessarily be country-specific. In Australia, 
> from memory, on tax invoices (invoices where GST is involved), the 
> amount of the GST must be shown when requested by a customer, if the 
> purchase is under 50 AUD, and, for purchases over 50AUD, where GST is 
> involved, the amount of the GST must be shown on each invoice. Apart 
> from that, in Australia, just to make it all more complicated, where a 
> business is satisfied (or can satisfy the federal tax department), that 
> the total percentage of sales by the business, that is subject to GST, 
> is something like 5% or less, the business can charge GST on everything, 
> so that it works out that the total GST charged for a reportable 
> period, is that percentage of total turnover, and the business then pays 
> the tax department, that percentage of its taxable turnover for the 
> period (Note: this is nothing to do with profit, or taxable profit; this 
> is only the sales tax payable on the turnover).
> 
> So, the dead chook may or may not be subject to GST, depending on 
> whether the vendor is subject to GST, the temperature of the dead chook, 
> whether the dead chook is cooked, and, whether the vendor wants to fudge 
> the figures, by shifting the GST liability to apply to everything. Which 
> also means that if you go to a grocer here, you have no idea as to 
> whether you are getting charged GST on something, whether you should be 
> getting charged GST on the item, or, how much GST is or should be 
> getting charged on the item.
> 
> In all of these circumstances, a business person has to be very careful, 
> when dealing with GST and accounting, and requires intricate checking 
> that it is all done right.
> 
> GST in Australia, is, to use the phrase of a Federal Court judge, 
> "Kafkaesque obscurantism", and when the person originally asked about 
> using GnuCash for GST accounting in Australia, he might as well have 
> been asking, "what happens if I use this person to see what happens when 
> I inject the person with heroin cut with PCP - what will the person 
> see, and, how will the person feel?".
> 
> That is why, as I said, if GnuCash is to be used for GST accounting in 
> Australia, for it to be done properly, so the user doesn't get done by 
> the tax department, for botching it up, country-specific, add-on modules 
> need to be developed, maintained, and, regularly checked, and, it is as 
> complicated as I have indicated.
> 
> That's what happens, when you open cans of worms.... :(
> 
> -- 
> Bret Busby
> Armadale
> West Australia
> ..............
> 
> "So once you do know what the question actually is,
>  you'll know what the answer means."
> - Deep Thought,
>   Chapter 28 of 
>   "The Hitchhiker's Guide to the Galaxy:
>   A Trilogy In Four Parts",
>   written by Douglas Adams, 
>   published by Pan Books, 1992 
> ....................................................
> 
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-- 
       Derek Atkins, SB '93 MIT EE, SM '95 MIT Media Laboratory
       Member, MIT Student Information Processing Board  (SIPB)
       URL: http://web.mit.edu/warlord/    PP-ASEL-IA     N1NWH
       warlord at MIT.EDU                        PGP key available