This fixes the discount_ calculation logic and promotion tax inclusiveness calculation (#12960)

* This fixes the discount_ calculation logic

* This fixes the adjustment to be handled as a subtotal value in every calculation and applies the tax inclusive logic on the promotion value itself

* Added some testcases and revoked some changes to improve testing output

* Fixed a test case based on feedback

* Corrected promotion/admin test cases

* Corrected cart/store test case

* Improved cart/store test cases for more robust promotion testing considering tax inclusion flags

* Remove unnessary changes as adjustments now automatically are subtotals and therefore the tax inclusive flag does not need to be applied again

* Remove adjustments->is_tax_inclusive usage everywhere

* Migration script to remove is_tax_inclusive in cart line item adjustment

* Forgot to adjust one more testcase

* Corrections based on fPolic feedback

* Refactored PR to consider feedback from oliver

* Added more testcases for promotion in cart

---------

Co-authored-by: Oli Juhl <59018053+olivermrbl@users.noreply.github.com>

.changeset/pink-baboons-wash.md

@@ -0,0 +1,11 @@
+---
+"@medusajs/promotion": patch
+"@medusajs/core-flows": patch
+"integration-tests-http": patch
+"@medusajs/cart": patch
+"@medusajs/types": patch
+"@medusajs/utils": patch
+"@medusajs/medusa": patch
+---
+
+This fixes the discount\_ calculation logic and promotion tax inclusiveness calculation

integration-tests/http/__tests__/cart/store/cart.spec.ts

@@ -419,22 +419,22 @@ medusaIntegrationTestRunner({
                   compare_at_unit_price: null,
                   is_tax_inclusive: true,
                   quantity: 2,
-                  tax_lines: [
+                  tax_lines: expect.arrayContaining([
                     expect.objectContaining({
                       description: "CA Default Rate",
                       code: "CADEFAULT",
                       rate: 5,
                       provider_id: "system",
                     }),
-                  ],
+                  ]),
-                  adjustments: [
+                  adjustments: expect.arrayContaining([
-                    {
+                    expect.objectContaining({
                       id: expect.any(String),
                       code: "PROMOTION_APPLIED",
                       promotion_id: promotion.id,
                       amount: 100,
-                    },
+                    }),
-                  ],
+                  ]),
                 }),
               ]),
             })
@@ -456,14 +456,14 @@ medusaIntegrationTestRunner({
               id: cart.id,
               items: expect.arrayContaining([
                 expect.objectContaining({
-                  adjustments: [
+                  adjustments: expect.arrayContaining([
-                    {
+                    expect.objectContaining({
                       id: expect.any(String),
                       code: "PROMOTION_APPLIED",
                       promotion_id: promotion.id,
                       amount: 100,
-                    },
+                    }),
-                  ],
+                  ]),
                 }),
               ]),
             })
@@ -823,22 +823,22 @@ medusaIntegrationTestRunner({
                     compare_at_unit_price: 1500,
                     is_tax_inclusive: true,
                     quantity: 2,
-                    tax_lines: [
+                    tax_lines: expect.arrayContaining([
                       expect.objectContaining({
                         description: "CA Default Rate",
                         code: "CADEFAULT",
                         rate: 5,
                         provider_id: "system",
                       }),
-                    ],
+                    ]),
-                    adjustments: [
+                    adjustments: expect.arrayContaining([
-                      {
+                      expect.objectContaining({
                         id: expect.any(String),
                         code: "PROMOTION_APPLIED",
                         promotion_id: promotion.id,
                         amount: 100,
-                      },
+                      }),
-                    ],
+                    ]),
                   }),
                 ]),
               })
@@ -1235,7 +1235,7 @@ medusaIntegrationTestRunner({
                 id: expect.any(String),
                 currency_code: "usd",
                 credit_line_total: 2395,
-                discount_total: 100,
+                discount_total: 105,
                 credit_lines: [
                   expect.objectContaining({
                     amount: 2395,
@@ -2794,7 +2794,7 @@ medusaIntegrationTestRunner({
                   is_discountable: true,
                   unit_price: 1500,
                   total: 1395,
-                  discount_total: 100,
+                  discount_total: 105,
                   adjustments: [
                     expect.objectContaining({
                       promotion_id: promotion.id,
@@ -2825,14 +2825,14 @@ medusaIntegrationTestRunner({
               id: cart.id,
               items: expect.arrayContaining([
                 expect.objectContaining({
-                  adjustments: [
+                  adjustments: expect.arrayContaining([
-                    {
+                    expect.objectContaining({
                       id: expect.any(String),
                       code: "PROMOTION_APPLIED",
                       promotion_id: promotion.id,
                       amount: 100,
-                    },
+                    }),
-                  ],
+                  ]),
                 }),
               ]),
             })
@@ -2860,6 +2860,609 @@ medusaIntegrationTestRunner({
             })
           )
         })
+
+        it("should add a 100 USD tax exclusive promotion for a 105 USD tax inclusive item and logically result in a 0 total with tax 5%", async () => {
+          const taxExclPromotion = (
+            await api.post(
+              `/admin/promotions`,
+              {
+                code: "PROMOTION_TAX_EXCLUSIVE",
+                type: PromotionType.STANDARD,
+                status: PromotionStatus.ACTIVE,
+                is_tax_inclusive: false, //Here we apply a tax exclusive promotion to a tax inclusive item in a way that the total SHOULD be 0
+                application_method: {
+                  type: "fixed",
+                  target_type: "items",
+                  allocation: "across",
+                  currency_code: "usd",
+                  value: 100,
+                  apply_to_quantity: 1,
+                },
+              },
+              adminHeaders
+            )
+          ).data.promotion
+
+          const product = (
+            await api.post(
+              `/admin/products`,
+              {
+                title: "Product for free",
+                description: "test",
+                options: [
+                  {
+                    title: "Size",
+                    values: ["S", "M", "L", "XL"],
+                  },
+                ],
+                variants: [
+                  {
+                    title: "S / Black",
+                    sku: "special-shirt",
+                    options: {
+                      Size: "S",
+                    },
+                    manage_inventory: false,
+                    prices: [
+                      {
+                        amount: 105,
+                        currency_code: "usd",
+                      },
+                    ],
+                  },
+                ],
+              },
+              adminHeaders
+            )
+          ).data.product
+
+          cart = (
+            await api.post(
+              `/store/carts`,
+              {
+                currency_code: "usd",
+                sales_channel_id: salesChannel.id,
+                region_id: region.id,
+                shipping_address: shippingAddressData,
+              },
+              storeHeadersWithCustomer
+            )
+          ).data.cart
+
+          cart = (
+            await api.post(
+              `/store/carts/${cart.id}/line-items`,
+              {
+                variant_id: product.variants[0].id,
+                quantity: 1,
+              },
+              storeHeaders
+            )
+          ).data.cart
+
+          let updated = await api.post(
+            `/store/carts/${cart.id}`,
+            { promo_codes: [taxExclPromotion.code] },
+            storeHeaders
+          )
+
+          expect(updated.status).toEqual(200)
+          expect(updated.data.cart).toEqual(
+            expect.objectContaining({
+              discount_total: 105,
+              discount_subtotal: 100,
+              discount_tax_total: 5,
+              original_total: 105,
+              total: 0, // 105 - 100 tax excl promotion + 5 promotion tax
+              items: expect.arrayContaining([
+                expect.objectContaining({
+                  is_tax_inclusive: true,
+                  adjustments: expect.arrayContaining([
+                    expect.objectContaining({
+                      code: taxExclPromotion.code,
+                      amount: 100,
+                    }),
+                  ]),
+                }),
+              ]),
+              promotions: expect.arrayContaining([
+                expect.objectContaining({
+                  code: "PROMOTION_TAX_EXCLUSIVE",
+                  application_method: expect.objectContaining({
+                    value: 100,
+                  }),
+                }),
+              ]),
+            })
+          )
+        })
+
+        it("should add a 105 USD tax inclusive promotion (fixed, across, apply_to_quantity=1) for a 105 USD tax inclusive item and logically result in a 0 total with tax 5%", async () => {
+          const taxInclPromotion = (
+            await api.post(
+              `/admin/promotions`,
+              {
+                code: "PROMOTION_TAX_INCLUSIVE",
+                type: PromotionType.STANDARD,
+                status: PromotionStatus.ACTIVE,
+                is_tax_inclusive: true, //Here we apply a tax inclusive promotion to a tax inclusive item in a way that the total SHOULD be 0
+                application_method: {
+                  type: "fixed",
+                  target_type: "items",
+                  allocation: "across",
+                  currency_code: "usd",
+                  value: 105,
+                  apply_to_quantity: 1,
+                },
+              },
+              adminHeaders
+            )
+          ).data.promotion
+
+          const product = (
+            await api.post(
+              `/admin/products`,
+              {
+                title: "Product for free",
+                description: "test",
+                options: [
+                  {
+                    title: "Size",
+                    values: ["S", "M", "L", "XL"],
+                  },
+                ],
+                variants: [
+                  {
+                    title: "S / Black",
+                    sku: "special-shirt",
+                    options: {
+                      Size: "S",
+                    },
+                    manage_inventory: false,
+                    prices: [
+                      {
+                        amount: 105,
+                        currency_code: "usd",
+                      },
+                    ],
+                  },
+                ],
+              },
+              adminHeaders
+            )
+          ).data.product
+
+          cart = (
+            await api.post(
+              `/store/carts`,
+              {
+                currency_code: "usd",
+                sales_channel_id: salesChannel.id,
+                region_id: region.id,
+                shipping_address: shippingAddressData,
+              },
+              storeHeadersWithCustomer
+            )
+          ).data.cart
+
+          cart = (
+            await api.post(
+              `/store/carts/${cart.id}/line-items`,
+              {
+                variant_id: product.variants[0].id,
+                quantity: 1,
+              },
+              storeHeaders
+            )
+          ).data.cart
+
+          let updated = await api.post(
+            `/store/carts/${cart.id}`,
+            { promo_codes: [taxInclPromotion.code] },
+            storeHeaders
+          )
+
+          expect(updated.status).toEqual(200)
+          expect(updated.data.cart).toEqual(
+            expect.objectContaining({
+              discount_total: 105,
+              discount_subtotal: 100,
+              discount_tax_total: 5,
+              original_total: 105,
+              total: 0, // 105 - 100 tax excl promotion + 5 promotion tax
+              items: expect.arrayContaining([
+                expect.objectContaining({
+                  is_tax_inclusive: true,
+                  adjustments: expect.arrayContaining([
+                    expect.objectContaining({
+                      code: taxInclPromotion.code,
+                      amount: 105,
+                      is_tax_inclusive: true,
+                    }),
+                  ]),
+                }),
+              ]),
+              promotions: expect.arrayContaining([
+                expect.objectContaining({
+                  code: "PROMOTION_TAX_INCLUSIVE",
+                  is_tax_inclusive: true,
+                  application_method: expect.objectContaining({
+                    value: 105,
+                  }),
+                }),
+              ]),
+            })
+          )
+        })
+
+        it("should add a 105 USD tax inclusive promotion (fixed, across, apply_to_quantity=1) for two 105 USD tax inclusive items and logically result in a 105 total with tax 5%", async () => {
+          const taxInclPromotion = (
+            await api.post(
+              `/admin/promotions`,
+              {
+                code: "PROMOTION_TAX_INCLUSIVE",
+                type: PromotionType.STANDARD,
+                status: PromotionStatus.ACTIVE,
+                is_tax_inclusive: true, //Here we apply a tax inclusive promotion to a tax inclusive item in a way that the total SHOULD be 0
+                application_method: {
+                  type: "fixed",
+                  target_type: "items",
+                  allocation: "across",
+                  currency_code: "usd",
+                  value: 105,
+                  apply_to_quantity: 1,
+                },
+              },
+              adminHeaders
+            )
+          ).data.promotion
+
+          const product = (
+            await api.post(
+              `/admin/products`,
+              {
+                title: "Product for free",
+                description: "test",
+                options: [
+                  {
+                    title: "Size",
+                    values: ["S", "M", "L", "XL"],
+                  },
+                ],
+                variants: [
+                  {
+                    title: "S / Black",
+                    sku: "special-shirt",
+                    options: {
+                      Size: "S",
+                    },
+                    manage_inventory: false,
+                    prices: [
+                      {
+                        amount: 105,
+                        currency_code: "usd",
+                      },
+                    ],
+                  },
+                ],
+              },
+              adminHeaders
+            )
+          ).data.product
+
+          cart = (
+            await api.post(
+              `/store/carts`,
+              {
+                currency_code: "usd",
+                sales_channel_id: salesChannel.id,
+                region_id: region.id,
+                shipping_address: shippingAddressData,
+              },
+              storeHeadersWithCustomer
+            )
+          ).data.cart
+
+          cart = (
+            await api.post(
+              `/store/carts/${cart.id}/line-items`,
+              {
+                variant_id: product.variants[0].id,
+                quantity: 2,
+              },
+              storeHeaders
+            )
+          ).data.cart
+
+          let updated = await api.post(
+            `/store/carts/${cart.id}`,
+            { promo_codes: [taxInclPromotion.code] },
+            storeHeaders
+          )
+
+          expect(updated.status).toEqual(200)
+          expect(updated.data.cart).toEqual(
+            expect.objectContaining({
+              discount_total: 105,
+              discount_subtotal: 100,
+              discount_tax_total: 5,
+              original_total: 210,
+              total: 105, // 210 - 100 tax excl promotion + 5 promotion tax
+              items: expect.arrayContaining([
+                expect.objectContaining({
+                  is_tax_inclusive: true,
+                  adjustments: expect.arrayContaining([
+                    expect.objectContaining({
+                      code: taxInclPromotion.code,
+                      amount: 105,
+                      is_tax_inclusive: true,
+                    }),
+                  ]),
+                }),
+              ]),
+              promotions: expect.arrayContaining([
+                expect.objectContaining({
+                  code: "PROMOTION_TAX_INCLUSIVE",
+                  is_tax_inclusive: true,
+                  application_method: expect.objectContaining({
+                    value: 105,
+                  }),
+                }),
+              ]),
+            })
+          )
+        })
+
+        it("should add a 105 USD tax inclusive promotion (fixed, each, max_quantity=2) for two 105 USD tax inclusive items and logically result in a 0 total with tax 5%", async () => {
+          const taxInclPromotion = (
+            await api.post(
+              `/admin/promotions`,
+              {
+                code: "PROMOTION_TAX_INCLUSIVE",
+                type: PromotionType.STANDARD,
+                status: PromotionStatus.ACTIVE,
+                is_tax_inclusive: true, //Here we apply a tax inclusive promotion to a tax inclusive item in a way that the total SHOULD be 0
+                application_method: {
+                  type: "fixed",
+                  target_type: "items",
+                  allocation: "each",
+                  currency_code: "usd",
+                  value: 105,
+                  max_quantity: 2,
+                },
+              },
+              adminHeaders
+            )
+          ).data.promotion
+
+          const product = (
+            await api.post(
+              `/admin/products`,
+              {
+                title: "Product for free",
+                description: "test",
+                options: [
+                  {
+                    title: "Size",
+                    values: ["S", "M", "L", "XL"],
+                  },
+                ],
+                variants: [
+                  {
+                    title: "S / Black",
+                    sku: "special-shirt",
+                    options: {
+                      Size: "S",
+                    },
+                    manage_inventory: false,
+                    prices: [
+                      {
+                        amount: 105,
+                        currency_code: "usd",
+                      },
+                    ],
+                  },
+                ],
+              },
+              adminHeaders
+            )
+          ).data.product
+
+          cart = (
+            await api.post(
+              `/store/carts`,
+              {
+                currency_code: "usd",
+                sales_channel_id: salesChannel.id,
+                region_id: region.id,
+                shipping_address: shippingAddressData,
+              },
+              storeHeadersWithCustomer
+            )
+          ).data.cart
+
+          cart = (
+            await api.post(
+              `/store/carts/${cart.id}/line-items`,
+              {
+                variant_id: product.variants[0].id,
+                quantity: 2,
+              },
+              storeHeaders
+            )
+          ).data.cart
+
+          let updated = await api.post(
+            `/store/carts/${cart.id}`,
+            { promo_codes: [taxInclPromotion.code] },
+            storeHeaders
+          )
+
+          expect(updated.status).toEqual(200)
+          expect(updated.data.cart).toEqual(
+            expect.objectContaining({
+              discount_total: 105,
+              discount_subtotal: 100,
+              discount_tax_total: 5,
+              original_total: 210,
+              total: 105, // 210 - 100 tax excl promotion + 5 promotion tax
+              items: expect.arrayContaining([
+                expect.objectContaining({
+                  is_tax_inclusive: true,
+                  adjustments: expect.arrayContaining([
+                    expect.objectContaining({
+                      code: taxInclPromotion.code,
+                      amount: 105,
+                      is_tax_inclusive: true,
+                    }),
+                  ]),
+                }),
+              ]),
+              promotions: expect.arrayContaining([
+                expect.objectContaining({
+                  code: "PROMOTION_TAX_INCLUSIVE",
+                  is_tax_inclusive: true,
+                  application_method: expect.objectContaining({
+                    value: 105,
+                  }),
+                }),
+              ]),
+            })
+          )
+        })
+
+        it("should add two tax inclusive promotions (50,100) (fixed, across) for two 105 USD tax inclusive items", async () => {
+          const taxInclPromotion50 = (
+            await api.post(
+              `/admin/promotions`,
+              {
+                code: "PROMOTION_TAX_INCLUSIVE_50",
+                type: PromotionType.STANDARD,
+                status: PromotionStatus.ACTIVE,
+                is_tax_inclusive: true,
+                application_method: {
+                  type: "fixed",
+                  target_type: "items",
+                  allocation: "across",
+                  currency_code: "usd",
+                  value: 50,
+                },
+              },
+              adminHeaders
+            )
+          ).data.promotion
+
+          const taxInclPromotion100 = (
+            await api.post(
+              `/admin/promotions`,
+              {
+                code: "PROMOTION_TAX_INCLUSIVE_100",
+                type: PromotionType.STANDARD,
+                status: PromotionStatus.ACTIVE,
+                is_tax_inclusive: true,
+                application_method: {
+                  type: "fixed",
+                  target_type: "items",
+                  allocation: "across",
+                  currency_code: "usd",
+                  value: 100,
+                },
+              },
+              adminHeaders
+            )
+          ).data.promotion
+
+          const product = (
+            await api.post(
+              `/admin/products`,
+              {
+                title: "Product for free",
+                description: "test",
+                options: [
+                  {
+                    title: "Size",
+                    values: ["S", "M", "L", "XL"],
+                  },
+                ],
+                variants: [
+                  {
+                    title: "S / Black",
+                    sku: "special-shirt",
+                    options: {
+                      Size: "S",
+                    },
+                    manage_inventory: false,
+                    prices: [
+                      {
+                        amount: 105,
+                        currency_code: "usd",
+                      },
+                    ],
+                  },
+                ],
+              },
+              adminHeaders
+            )
+          ).data.product
+
+          cart = (
+            await api.post(
+              `/store/carts`,
+              {
+                currency_code: "usd",
+                sales_channel_id: salesChannel.id,
+                region_id: region.id,
+                shipping_address: shippingAddressData,
+              },
+              storeHeadersWithCustomer
+            )
+          ).data.cart
+
+          cart = (
+            await api.post(
+              `/store/carts/${cart.id}/line-items`,
+              {
+                variant_id: product.variants[0].id,
+                quantity: 2,
+              },
+              storeHeaders
+            )
+          ).data.cart
+
+          let updated = await api.post(
+            `/store/carts/${cart.id}`,
+            {
+              promo_codes: [taxInclPromotion50.code, taxInclPromotion100.code],
+            },
+            storeHeaders
+          )
+
+          expect(updated.status).toEqual(200)
+          expect(updated.data.cart).toEqual(
+            expect.objectContaining({
+              discount_total: 150,
+              original_total: 210,
+              total: 60, // 210 - (100 + 50 tax incl promotion)
+              items: expect.arrayContaining([
+                expect.objectContaining({
+                  is_tax_inclusive: true,
+                  adjustments: expect.arrayContaining([
+                    expect.objectContaining({
+                      code: taxInclPromotion50.code,
+                      amount: 50,
+                      is_tax_inclusive: true,
+                    }),
+                    expect.objectContaining({
+                      code: taxInclPromotion100.code,
+                      amount: 100,
+                      is_tax_inclusive: true,
+                    }),
+                  ]),
+                }),
+              ]),
+            })
+          )
+        })
       })
 
       describe("POST /store/carts/:id/customer", () => {

integration-tests/http/__tests__/promotions/admin/promotions.spec.ts

@@ -1322,9 +1322,9 @@ medusaIntegrationTestRunner({
               original_total: 1300,
               original_tax_total: 260,
 
-              discount_total: 100,
+              discount_total: 125,
               discount_subtotal: 100,
-              discount_tax_total: 20,
+              discount_tax_total: 25,
 
               item_total: 1175,
               item_subtotal: 1040,
@@ -1354,14 +1354,13 @@ medusaIntegrationTestRunner({
                   original_total: 1300,
                   original_tax_total: 260,
 
-                  discount_total: 100,
+                  discount_total: 125,
                   discount_subtotal: 100,
-                  discount_tax_total: 20,
+                  discount_tax_total: 25,
 
                   adjustments: expect.arrayContaining([
                     expect.objectContaining({
                       amount: 100,
-                      is_tax_inclusive: false,
                     }),
                   ]),
                 }),
@@ -1403,9 +1402,9 @@ medusaIntegrationTestRunner({
               original_total: 1300,
               original_tax_total: 260,
 
-              discount_total: 100,
+              discount_total: 125,
               discount_subtotal: 100,
-              discount_tax_total: 20,
+              discount_tax_total: 25,
 
               item_total: 1175,
               item_subtotal: 1040,
@@ -1435,14 +1434,13 @@ medusaIntegrationTestRunner({
                   original_total: 1300,
                   original_tax_total: 260,
 
-                  discount_total: 100,
+                  discount_total: 125,
                   discount_subtotal: 100,
-                  discount_tax_total: 20,
+                  discount_tax_total: 25,
 
                   adjustments: expect.arrayContaining([
                     expect.objectContaining({
                       amount: 100,
-                      is_tax_inclusive: false,
                     }),
                   ]),
                 }),
@@ -1598,7 +1596,6 @@ medusaIntegrationTestRunner({
                   adjustments: expect.arrayContaining([
                     expect.objectContaining({
                       amount: 100,
-                      is_tax_inclusive: false,
                     }),
                   ]),
                 }),
@@ -1679,7 +1676,6 @@ medusaIntegrationTestRunner({
                   adjustments: expect.arrayContaining([
                     expect.objectContaining({
                       amount: 100,
-                      is_tax_inclusive: false,
                     }),
                   ]),
                 }),

packages/core/types/src/promotion/common/compute-actions.ts

@@ -61,11 +61,10 @@ export interface AddItemAdjustmentAction {
   amount: BigNumberInput
 
   /**
-   * Whether the adjustment amount includes tax.
+   * Whether the promotion amount includes tax.
    */
   is_tax_inclusive?: boolean
 
-  /**
   /**
    * The promotion's code.
    */
@@ -186,6 +185,11 @@ export interface ComputeActionItemLine extends Record<string, unknown> {
    */
   subtotal: BigNumberInput
 
+  /**
+   * The total of the line item.
+   */
+  total: BigNumberInput
+
   /**
    * Whether the line item is discountable.
    */
@@ -211,6 +215,11 @@ export interface ComputeActionShippingLine extends Record<string, unknown> {
    */
   subtotal: BigNumberInput
 
+  /**
+   * The total of the shipping method.
+   */
+  total: BigNumberInput
+
   /**
    * The adjustments applied before on the shipping method.
    */

packages/core/utils/src/totals/__tests__/totals.ts

@@ -124,8 +124,8 @@ describe("Total calculation", function () {
           adjustments: [
             {
               amount: 10,
-              total: 11,
               subtotal: 10,
+              total: 11,
             },
           ],
           subtotal: 100,
@@ -244,16 +244,16 @@ describe("Total calculation", function () {
           adjustments: [
             {
               amount: 9,
-              subtotal: 8.181818181818182,
+              subtotal: 9,
-              total: 9,
+              total: 9.9,
             },
           ],
           subtotal: 90,
           total: 89.1,
           original_total: 99,
-          discount_total: 9,
+          discount_total: 9.9,
           discount_subtotal: 9,
-          discount_tax_total: 0.8181818181818182,
+          discount_tax_total: 0.9,
           tax_total: 8.1,
           original_tax_total: 9,
         },
@@ -298,17 +298,17 @@ describe("Total calculation", function () {
           adjustments: [
             {
               amount: 9,
-              subtotal: 8.181818181818182,
+              subtotal: 9,
-              total: 9,
+              total: 9.9,
             },
           ],
           amount: 99,
           subtotal: 90,
           total: 89.1,
           original_total: 99,
-          discount_total: 9,
+          discount_total: 9.9,
           discount_subtotal: 9,
-          discount_tax_total: 0.8181818181818182,
+          discount_tax_total: 0.9,
           tax_total: 8.1,
           original_tax_total: 9,
         },
@@ -342,9 +342,9 @@ describe("Total calculation", function () {
       total: 191.4,
       subtotal: 198,
       tax_total: 17.4,
-      discount_total: 24.6,
+      discount_total: 26.4,
       discount_subtotal: 24,
-      discount_tax_total: 2.2363636363636363,
+      discount_tax_total: 2.4,
       original_total: 217.8,
       original_tax_total: 19.8,
       item_total: 95.7,
@@ -562,7 +562,7 @@ describe("Total calculation", function () {
      * TAX INCLUSIVE CART
      *
      * Total price -> 120 tax inclusive
-     * Fixed discount -> 10 tax inclusive
+     * Fixed discount -> 10 tax inclusive total (which results in a subtotal of 8.33 of the discount)
      * Tax rate -> 20%
      */
 
@@ -574,8 +574,7 @@ describe("Total calculation", function () {
           is_tax_inclusive: true,
           adjustments: [
             {
-              amount: 10,
+              amount: 8.333333333333334,
-              is_tax_inclusive: true,
             },
           ],
           tax_lines: [
@@ -615,8 +614,7 @@ describe("Total calculation", function () {
           ],
           adjustments: [
             {
-              is_tax_inclusive: true,
+              amount: 8.333333333333334,
-              amount: 10, // <- amount is tax inclusive so it's equal to total
               subtotal: 8.333333333333334,
               total: 10,
             },
@@ -625,7 +623,7 @@ describe("Total calculation", function () {
       ],
       subtotal: 100,
       tax_total: 18.333333333333332,
-      total: 110, // total is 120 - 10 tax inclusive discount
+      total: 110,
 
       original_item_subtotal: 100,
       original_item_tax_total: 20,
@@ -882,4 +880,338 @@ describe("Total calculation", function () {
       credit_line_total: 40,
     })
   })
+
+  it("should calculate carts with items + taxes + adjustments", function () {
+    const cart = {
+      items: [
+        {
+          unit_price: 119,
+          quantity: 1,
+          tax_lines: [
+            {
+              rate: 19,
+            },
+          ],
+          adjustments: [
+            {
+              amount: 119,
+            },
+          ],
+        },
+      ],
+    }
+
+    const serialized = JSON.parse(JSON.stringify(decorateCartTotals(cart)))
+
+    expect(serialized).toEqual({
+      items: [
+        {
+          unit_price: 119,
+          quantity: 1,
+          tax_lines: [
+            {
+              rate: 19,
+              subtotal: 22.61,
+            },
+          ],
+          adjustments: [
+            {
+              amount: 119,
+              subtotal: 119,
+              total: 141.61,
+            },
+          ],
+          subtotal: 119,
+          total: 0,
+          original_total: 141.61,
+          discount_total: 141.61,
+          discount_subtotal: 119,
+          discount_tax_total: 22.61,
+          tax_total: 0,
+          original_tax_total: 22.61,
+        },
+      ],
+      total: 0,
+      subtotal: 119,
+      tax_total: 0,
+      discount_total: 141.61,
+      discount_subtotal: 119,
+      discount_tax_total: 22.61,
+      original_total: 141.61,
+      original_tax_total: 22.61,
+      item_total: 0,
+      item_subtotal: 119,
+      item_tax_total: 0,
+      original_item_total: 141.61,
+      original_item_subtotal: 119,
+      original_item_tax_total: 22.61,
+      credit_line_subtotal: 0,
+      credit_line_tax_total: 0,
+      credit_line_total: 0,
+    })
+  })
+
+  it("should calculate carts with items + taxes with is_tax_inclusive", function () {
+    const cartWithTax = {
+      items: [
+        {
+          unit_price: 119,
+          quantity: 1,
+          is_tax_inclusive: true,
+          tax_lines: [
+            {
+              rate: 19,
+            },
+          ],
+        },
+      ],
+    }
+
+    const cartWithoutTax = {
+      items: [
+        {
+          unit_price: 119,
+          quantity: 1,
+          is_tax_inclusive: false,
+          tax_lines: [
+            {
+              rate: 19,
+            },
+          ],
+        },
+      ],
+    }
+
+    const cartMixed = {
+      items: [...cartWithTax.items, ...cartWithoutTax.items],
+    }
+
+    const serializedWith = JSON.parse(
+      JSON.stringify(decorateCartTotals(cartWithTax))
+    )
+    const serializedWithout = JSON.parse(
+      JSON.stringify(decorateCartTotals(cartWithoutTax))
+    )
+    const serializedMixed = JSON.parse(
+      JSON.stringify(decorateCartTotals(cartMixed))
+    )
+
+    expect(serializedWith).toEqual({
+      credit_line_subtotal: 0,
+      credit_line_tax_total: 0,
+      credit_line_total: 0,
+      discount_subtotal: 0,
+      discount_tax_total: 0,
+      discount_total: 0,
+      item_subtotal: 100,
+      item_tax_total: 19,
+      item_total: 119,
+      items: [
+        {
+          discount_subtotal: 0,
+          discount_tax_total: 0,
+          discount_total: 0,
+          is_tax_inclusive: true,
+          original_tax_total: 19,
+          original_total: 119,
+          quantity: 1,
+          subtotal: 100,
+          tax_lines: [
+            {
+              rate: 19,
+              subtotal: 19,
+              total: 19,
+            },
+          ],
+          tax_total: 19,
+          total: 119,
+          unit_price: 119,
+        },
+      ],
+      original_item_subtotal: 100,
+      original_item_tax_total: 19,
+      original_item_total: 119,
+      original_tax_total: 19,
+      original_total: 119,
+      subtotal: 100,
+      tax_total: 19,
+      total: 119,
+    })
+
+    expect(serializedWithout).toEqual({
+      credit_line_subtotal: 0,
+      credit_line_tax_total: 0,
+      credit_line_total: 0,
+      discount_subtotal: 0,
+      discount_tax_total: 0,
+      discount_total: 0,
+      item_subtotal: 119,
+      item_tax_total: 22.61,
+      item_total: 141.61,
+      items: [
+        {
+          discount_subtotal: 0,
+          discount_tax_total: 0,
+          discount_total: 0,
+          is_tax_inclusive: false,
+          original_tax_total: 22.61,
+          original_total: 141.61,
+          quantity: 1,
+          subtotal: 119,
+          tax_lines: [
+            {
+              rate: 19,
+              subtotal: 22.61,
+              total: 22.61,
+            },
+          ],
+          tax_total: 22.61,
+          total: 141.61,
+          unit_price: 119,
+        },
+      ],
+      original_item_subtotal: 119,
+      original_item_tax_total: 22.61,
+      original_item_total: 141.61,
+      original_tax_total: 22.61,
+      original_total: 141.61,
+      subtotal: 119,
+      tax_total: 22.61,
+      total: 141.61,
+    })
+
+    expect(serializedMixed).toEqual({
+      credit_line_subtotal: 0,
+      credit_line_tax_total: 0,
+      credit_line_total: 0,
+      discount_subtotal: 0,
+      discount_tax_total: 0,
+      discount_total: 0,
+      item_subtotal: 219,
+      item_tax_total: 41.61,
+      item_total: 260.61,
+      items: [
+        {
+          discount_subtotal: 0,
+          discount_tax_total: 0,
+          discount_total: 0,
+          is_tax_inclusive: true,
+          original_tax_total: 19,
+          original_total: 119,
+          quantity: 1,
+          subtotal: 100,
+          tax_lines: [
+            {
+              rate: 19,
+              subtotal: 19,
+              total: 19,
+            },
+          ],
+          tax_total: 19,
+          total: 119,
+          unit_price: 119,
+        },
+        {
+          discount_subtotal: 0,
+          discount_tax_total: 0,
+          discount_total: 0,
+          is_tax_inclusive: false,
+          original_tax_total: 22.61,
+          original_total: 141.61,
+          quantity: 1,
+          subtotal: 119,
+          tax_lines: [
+            {
+              rate: 19,
+              subtotal: 22.61,
+              total: 22.61,
+            },
+          ],
+          tax_total: 22.61,
+          total: 141.61,
+          unit_price: 119,
+        },
+      ],
+      original_item_subtotal: 219,
+      original_item_tax_total: 41.61,
+      original_item_total: 260.61,
+      original_tax_total: 41.61,
+      original_total: 260.61,
+      subtotal: 219,
+      tax_total: 41.61,
+      total: 260.61,
+    })
+  })
+
+  it("should calculate tax inclusive carts with items + taxes with tax inclusive adjustments", function () {
+    const cart = {
+      items: [
+        {
+          unit_price: 119,
+          quantity: 1,
+          is_tax_inclusive: true,
+          adjustments: [
+            {
+              amount: 100,
+            },
+          ],
+          tax_lines: [
+            {
+              rate: 19,
+            },
+          ],
+        },
+      ],
+    }
+
+    const serialized = JSON.parse(JSON.stringify(decorateCartTotals(cart)))
+
+    expect(serialized).toEqual({
+      credit_line_subtotal: 0,
+      credit_line_tax_total: 0,
+      credit_line_total: 0,
+      discount_subtotal: 100,
+      discount_tax_total: 19,
+      discount_total: 119,
+      item_subtotal: 100,
+      item_tax_total: 0,
+      item_total: 0,
+      items: [
+        {
+          adjustments: [
+            {
+              amount: 100,
+              subtotal: 100,
+              total: 119,
+            },
+          ],
+          discount_subtotal: 100,
+          discount_tax_total: 19,
+          discount_total: 119,
+          is_tax_inclusive: true,
+          original_tax_total: 19,
+          original_total: 119,
+          quantity: 1,
+          subtotal: 100,
+          tax_lines: [
+            {
+              rate: 19,
+              subtotal: 19,
+            },
+          ],
+          tax_total: 0,
+          total: 0,
+          unit_price: 119,
+        },
+      ],
+      original_item_subtotal: 100,
+      original_item_tax_total: 19,
+      original_item_total: 119,
+      original_tax_total: 19,
+      original_total: 119,
+      subtotal: 100,
+      tax_total: 0,
+      total: 0,
+    })
+  })
 })

packages/core/utils/src/totals/adjustment/index.ts

@@ -5,11 +5,9 @@ import { MathBN } from "../math"
 
 export function calculateAdjustmentTotal({
   adjustments,
-  includesTax,
   taxRate,
 }: {
   adjustments: Pick<AdjustmentLineDTO, "amount" | "is_tax_inclusive">[]
-  includesTax?: boolean
   taxRate?: BigNumberInput
 }) {
   // the sum of all adjustment amounts excluding tax
@@ -24,35 +22,22 @@ export function calculateAdjustmentTotal({
       continue
     }
 
-    const adjustmentAmount = MathBN.convert(adj.amount)
+    const adjustmentSubtotal =
+      isDefined(taxRate) && adj.is_tax_inclusive
+        ? MathBN.div(adj.amount, MathBN.add(1, taxRate))
+        : adj.amount
 
-    if (adj.is_tax_inclusive && isDefined(taxRate)) {
+    const adjustmentTaxTotal = isDefined(taxRate)
-      adjustmentsSubtotal = MathBN.add(
+      ? MathBN.mult(adjustmentSubtotal, taxRate)
-        adjustmentsSubtotal,
+      : 0
-        MathBN.div(adjustmentAmount, MathBN.add(1, taxRate))
+    const adjustmentTotal = MathBN.add(adjustmentSubtotal, adjustmentTaxTotal)
-      )
-    } else {
-      adjustmentsSubtotal = MathBN.add(adjustmentsSubtotal, adjustmentAmount)
-    }
 
-    if (isDefined(taxRate)) {
+    adjustmentsSubtotal = MathBN.add(adjustmentsSubtotal, adjustmentSubtotal)
-      const adjustmentSubtotal = includesTax
+    adjustmentsTaxTotal = MathBN.add(adjustmentsTaxTotal, adjustmentTaxTotal)
-        ? MathBN.div(adjustmentAmount, MathBN.add(1, taxRate))
+    adjustmentsTotal = MathBN.add(adjustmentsTotal, adjustmentTotal)
-        : adjustmentAmount
 
-      const adjustmentTaxTotal = MathBN.mult(adjustmentSubtotal, taxRate)
+    adj["subtotal"] = new BigNumber(adjustmentsSubtotal)
-      const adjustmentTotal = MathBN.add(adjustmentSubtotal, adjustmentTaxTotal)
+    adj["total"] = new BigNumber(adjustmentsTotal)
-
-      adj["subtotal"] = new BigNumber(adjustmentSubtotal)
-      adj["total"] = new BigNumber(adjustmentTotal)
-
-      adjustmentsTotal = MathBN.add(adjustmentsTotal, adjustmentTotal)
-      adjustmentsTaxTotal = MathBN.add(adjustmentsTaxTotal, adjustmentTaxTotal)
-    } else {
-      adj["subtotal"] = new BigNumber(adjustmentAmount)
-      adj["adjustmentAmount"] = new BigNumber(adjustmentAmount)
-      adjustmentsTotal = MathBN.add(adjustmentsTotal, adjustmentAmount)
-    }
   }
 
   return {

packages/core/utils/src/totals/line-item/index.ts

@@ -16,7 +16,7 @@ export interface GetItemTotalInput {
   quantity: BigNumber
   is_tax_inclusive?: boolean
   tax_lines?: Pick<TaxLineDTO, "rate">[]
-  adjustments?: Pick<AdjustmentLineDTO, "amount">[]
+  adjustments?: Pick<AdjustmentLineDTO, "amount" | "is_tax_inclusive">[]
   detail?: {
     fulfilled_quantity: BigNumber
     delivered_quantity: BigNumber
@@ -133,7 +133,6 @@ function getLineItemTotals(
     adjustmentsTaxTotal: discountTaxTotal,
   } = calculateAdjustmentTotal({
     adjustments: item.adjustments || [],
-    includesTax: isTaxInclusive,
     taxRate: sumTaxRate,
   })
 

packages/core/utils/src/totals/promotion/index.ts

@@ -5,23 +5,23 @@ import {
 } from "../../promotion"
 import { MathBN } from "../math"
 
-function getPromotionValueForPercentage(promotion, lineItemTotal) {
+function getPromotionValueForPercentage(promotion, lineItemAmount) {
-  return MathBN.mult(MathBN.div(promotion.value, 100), lineItemTotal)
+  return MathBN.mult(MathBN.div(promotion.value, 100), lineItemAmount)
 }
 
-function getPromotionValueForFixed(promotion, itemTotal, allItemsTotal) {
+function getPromotionValueForFixed(promotion, lineItemAmount, lineItemsAmount) {
   if (promotion.allocation === ApplicationMethodAllocation.ACROSS) {
     const promotionValueForItem = MathBN.mult(
-      MathBN.div(itemTotal, allItemsTotal),
+      MathBN.div(lineItemAmount, lineItemsAmount),
       promotion.value
     )
 
-    if (MathBN.lte(promotionValueForItem, itemTotal)) {
+    if (MathBN.lte(promotionValueForItem, lineItemAmount)) {
       return promotionValueForItem
     }
 
     const percentage = MathBN.div(
-      MathBN.mult(itemTotal, 100),
+      MathBN.mult(lineItemAmount, 100),
       promotionValueForItem
     )
 
@@ -30,16 +30,15 @@ function getPromotionValueForFixed(promotion, itemTotal, allItemsTotal) {
       MathBN.div(percentage, 100)
     ).precision(4)
   }
-
   return promotion.value
 }
 
-export function getPromotionValue(promotion, lineItemTotal, lineItemsTotal) {
+export function getPromotionValue(promotion, lineItemAmount, lineItemsAmount) {
   if (promotion.type === ApplicationMethodType.PERCENTAGE) {
-    return getPromotionValueForPercentage(promotion, lineItemTotal)
+    return getPromotionValueForPercentage(promotion, lineItemAmount)
   }
 
-  return getPromotionValueForFixed(promotion, lineItemTotal, lineItemsTotal)
+  return getPromotionValueForFixed(promotion, lineItemAmount, lineItemsAmount)
 }
 
 export function getApplicableQuantity(lineItem, maxQuantity) {
@@ -50,14 +49,18 @@ export function getApplicableQuantity(lineItem, maxQuantity) {
   return lineItem.quantity
 }
 
-function getLineItemUnitPrice(lineItem) {
+function getLineItemSubtotal(lineItem) {
   return MathBN.div(lineItem.subtotal, lineItem.quantity)
 }
 
+function getLineItemTotal(lineItem) {
+  return MathBN.div(lineItem.total, lineItem.quantity)
+}
+
 export function calculateAdjustmentAmountFromPromotion(
   lineItem,
   promotion,
-  lineItemsTotal: BigNumberInput = 0
+  lineItemsAmount: BigNumberInput = 0
 ) {
   /*
     For a promotion with an across allocation, we consider not only the line item total, but also the total of all other line items in the order.
@@ -89,20 +92,26 @@ export function calculateAdjustmentAmountFromPromotion(
   */
   if (promotion.allocation === ApplicationMethodAllocation.ACROSS) {
     const quantity = getApplicableQuantity(lineItem, promotion.max_quantity)
-    const lineItemTotal = MathBN.mult(getLineItemUnitPrice(lineItem), quantity)
-    const applicableTotal = MathBN.sub(lineItemTotal, promotion.applied_value)
 
-    if (MathBN.lte(applicableTotal, 0)) {
+    const lineItemAmount = MathBN.mult(
-      return applicableTotal
+      promotion.is_tax_inclusive
+        ? getLineItemTotal(lineItem)
+        : getLineItemSubtotal(lineItem),
+      quantity
+    )
+    const applicableAmount = MathBN.sub(lineItemAmount, promotion.applied_value)
+
+    if (MathBN.lte(applicableAmount, 0)) {
+      return applicableAmount
     }
 
     const promotionValue = getPromotionValue(
       promotion,
-      applicableTotal,
+      applicableAmount,
-      lineItemsTotal
+      lineItemsAmount
     )
 
-    return MathBN.min(promotionValue, applicableTotal)
+    return MathBN.min(promotionValue, applicableAmount)
   }
 
   /*
@@ -124,26 +133,32 @@ export function calculateAdjustmentAmountFromPromotion(
       We then apply whichever is lower.
   */
 
-  const remainingItemTotal = MathBN.sub(
+  const remainingItemAmount = MathBN.sub(
-    lineItem.subtotal,
+    promotion.is_tax_inclusive ? lineItem.total : lineItem.subtotal,
     promotion.applied_value
   )
-  const unitPrice = MathBN.div(lineItem.subtotal, lineItem.quantity)
+  const itemAmount = MathBN.div(
-  const maximumPromotionTotal = MathBN.mult(
+    promotion.is_tax_inclusive ? lineItem.total : lineItem.subtotal,
-    unitPrice,
+    lineItem.quantity
+  )
+  const maximumPromotionAmount = MathBN.mult(
+    itemAmount,
     promotion.max_quantity ?? MathBN.convert(1)
   )
-  const applicableTotal = MathBN.min(remainingItemTotal, maximumPromotionTotal)
+  const applicableAmount = MathBN.min(
+    remainingItemAmount,
+    maximumPromotionAmount
+  )
 
-  if (MathBN.lte(applicableTotal, 0)) {
+  if (MathBN.lte(applicableAmount, 0)) {
     return MathBN.convert(0)
   }
 
   const promotionValue = getPromotionValue(
     promotion,
-    applicableTotal,
+    applicableAmount,
-    lineItemsTotal
+    lineItemsAmount
   )
 
-  return MathBN.min(promotionValue, applicableTotal)
+  return MathBN.min(promotionValue, applicableAmount)
 }

packages/core/utils/src/totals/shipping-method/index.ts

@@ -72,7 +72,6 @@ export function getShippingMethodTotals(
     adjustmentsTaxTotal: discountsTaxTotal,
   } = calculateAdjustmentTotal({
     adjustments: shippingMethod.adjustments || [],
-    includesTax: isTaxInclusive,
     taxRate: sumTaxRate,
   })
 

packages/medusa/src/api/store/carts/query-config.ts

@@ -35,6 +35,7 @@ export const defaultStoreCartFields = [
   "promotions.id",
   "promotions.code",
   "promotions.is_automatic",
+  "promotions.is_tax_inclusive",
   "promotions.application_method.value",
   "promotions.application_method.type",
   "promotions.application_method.currency_code",
@@ -77,6 +78,7 @@ export const defaultStoreCartFields = [
   "items.adjustments.code",
   "items.adjustments.promotion_id",
   "items.adjustments.amount",
+  "items.adjustments.is_tax_inclusive",
   "customer.id",
   "customer.email",
   "customer.groups.id",

packages/modules/promotion/src/utils/compute-actions/line-items.ts

@@ -103,24 +103,29 @@ function applyPromotionToItems(
     ? 1
     : applicationMethod?.max_quantity!
 
-  let lineItemsTotal = MathBN.convert(0)
+  let lineItemsAmount = MathBN.convert(0)
   if (allocation === ApplicationMethodAllocation.ACROSS) {
-    lineItemsTotal = applicableItems.reduce(
+    lineItemsAmount = applicableItems.reduce(
       (acc, item) =>
         MathBN.sub(
-          MathBN.add(acc, item.subtotal),
+          MathBN.add(
+            acc,
+            promotion.is_tax_inclusive ? item.total : item.subtotal
+          ),
           appliedPromotionsMap.get(item.id) ?? 0
         ),
       MathBN.convert(0)
     )
 
-    if (MathBN.lte(lineItemsTotal, 0)) {
+    if (MathBN.lte(lineItemsAmount, 0)) {
       return computedActions
     }
   }
 
   for (const item of applicableItems) {
-    if (MathBN.lte(item.subtotal, 0)) {
+    if (
+      MathBN.lte(promotion.is_tax_inclusive ? item.total : item.subtotal, 0)
+    ) {
       continue
     }
 
@@ -135,11 +140,12 @@ function applyPromotionToItems(
       {
         value: promotionValue,
         applied_value: appliedPromoValue,
+        is_tax_inclusive: promotion.is_tax_inclusive,
         max_quantity: maxQuantity,
         type: applicationMethod?.type!,
         allocation,
       },
-      lineItemsTotal
+      lineItemsAmount
     )
 
     if (MathBN.lte(amount, 0)) {