feat(promotion, dashboard, core-flows, cart, types, utils, medusa): tax inclusive promotions (#12412)

* feat: tax inclusive promotions

* feat: add a totals test case

* feat: add integration test

* chore: changeset

* fix: typo

* chore: refactor

* fix: tests

* fix: rest of buyget action tests

* fix: cart spec

* chore: expand integration test with item level totals

* feat: add a few more test cases

---------

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

.changeset/metal-kangaroos-push.md

@@ -0,0 +1,11 @@
+---
+"@medusajs/promotion": patch
+"@medusajs/dashboard": patch
+"@medusajs/core-flows": patch
+"@medusajs/cart": patch
+"@medusajs/types": patch
+"@medusajs/utils": patch
+"@medusajs/medusa": patch
+---
+
+feat(promotion, dashboard, core-flows, cart, types, utils, medusa): tax inclusive promotions

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

@@ -1,11 +1,12 @@
 import { medusaIntegrationTestRunner } from "@medusajs/test-utils"
-import { PromotionStatus, PromotionType } from "@medusajs/utils"
+import { Modules, PromotionStatus, PromotionType } from "@medusajs/utils"
 import {
   createAdminUser,
   generatePublishableKey,
   generateStoreHeaders,
 } from "../../../../helpers/create-admin-user"
 import { medusaTshirtProduct } from "../../../__fixtures__/product"
+import { setupTaxStructure } from "../../../../modules/__tests__/fixtures/tax"
 
 jest.setTimeout(50000)
 
@@ -71,6 +72,8 @@ medusaIntegrationTestRunner({
       beforeEach(async () => {
         await createAdminUser(dbConnection, adminHeaders, appContainer)
 
+        await setupTaxStructure(appContainer.resolve(Modules.TAX))
+
         promotion = standardPromotion = (
           await api.post(
             `/admin/promotions`,
@@ -629,6 +632,729 @@ medusaIntegrationTestRunner({
             )
           })
         })
+
+        it("should add tax inclusive promotion to cart successfully in a tax inclusive currency", async () => {
+          const publishableKey = await generatePublishableKey(appContainer)
+          const storeHeaders = generateStoreHeaders({ publishableKey })
+
+          const salesChannel = (
+            await api.post(
+              "/admin/sales-channels",
+              { name: "Webshop", description: "channel" },
+              adminHeaders
+            )
+          ).data.sales_channel
+
+          await api.post(
+            "/admin/price-preferences",
+            {
+              attribute: "currency_code",
+              value: "dkk",
+              is_tax_inclusive: true,
+            },
+            adminHeaders
+          )
+
+          const region = (
+            await api.post(
+              "/admin/regions",
+              {
+                name: "DK",
+                currency_code: "dkk",
+                countries: ["dk"],
+              },
+              adminHeaders
+            )
+          ).data.region
+
+          const product = (
+            await api.post(
+              "/admin/products",
+              {
+                ...medusaTshirtProduct,
+                shipping_profile_id: shippingProfile.id,
+              },
+              adminHeaders
+            )
+          ).data.product
+
+          const response = await api.post(
+            `/admin/promotions`,
+            {
+              code: "FIXED_10",
+              type: PromotionType.STANDARD,
+              status: PromotionStatus.ACTIVE,
+              is_tax_inclusive: true,
+              is_automatic: true,
+              application_method: {
+                target_type: "items",
+                type: "fixed",
+                allocation: "across",
+                currency_code: "DKK",
+                value: 100,
+              },
+            },
+            adminHeaders
+          )
+
+          expect(response.status).toEqual(200)
+          expect(response.data.promotion).toEqual(
+            expect.objectContaining({
+              id: expect.any(String),
+              code: "FIXED_10",
+              type: "standard",
+              is_tax_inclusive: true,
+              is_automatic: true,
+              application_method: expect.objectContaining({
+                value: 100,
+                type: "fixed",
+                target_type: "items",
+                allocation: "across",
+              }),
+            })
+          )
+
+          const cart = (
+            await api.post(
+              `/store/carts?fields=*items,*items.adjustments`,
+              {
+                currency_code: "dkk",
+                sales_channel_id: salesChannel.id,
+                region_id: region.id,
+                items: [
+                  {
+                    variant_id: product.variants[0].id,
+                    quantity: 1,
+                  },
+                ],
+                promo_codes: [response.data.promotion.code],
+              },
+              storeHeaders
+            )
+          ).data.cart
+
+          /**
+           * Orignal total -> 1300 DKK (tax incl.)
+           * Tax rate -> 25%
+           * Promotion -> FIXED 100 DKK (tax incl.)
+           *
+           * We want total to be 1300 DKK - 100 DKK = 1200 DKK
+           */
+          expect(cart).toEqual(
+            expect.objectContaining({
+              currency_code: "dkk",
+
+              subtotal: 1040, // taxable base (item subtotal - discount subtotal) = 1040 - 80 = 960
+              total: 1200, // total = taxable base * (1 + tax rate) = 960 * (1 + 0.25) = 1200
+              tax_total: 240,
+
+              original_total: 1300,
+              original_tax_total: 260,
+
+              discount_total: 100,
+              discount_subtotal: 80,
+              discount_tax_total: 20,
+
+              item_total: 1200,
+              item_subtotal: 1040,
+              item_tax_total: 240,
+
+              original_item_total: 1300,
+              original_item_subtotal: 1040,
+              original_item_tax_total: 260,
+
+              shipping_total: 0,
+              shipping_subtotal: 0,
+              shipping_tax_total: 0,
+
+              original_shipping_tax_total: 0,
+              original_shipping_subtotal: 0,
+              original_shipping_total: 0,
+
+              items: expect.arrayContaining([
+                expect.objectContaining({
+                  quantity: 1,
+                  unit_price: 1300,
+
+                  subtotal: 1040,
+                  tax_total: 240,
+                  total: 1200,
+
+                  original_total: 1300,
+                  original_tax_total: 260,
+
+                  discount_total: 100,
+                  discount_subtotal: 80,
+                  discount_tax_total: 20,
+
+                  adjustments: expect.arrayContaining([
+                    expect.objectContaining({
+                      amount: 100,
+                      is_tax_inclusive: true,
+                    }),
+                  ]),
+                }),
+              ]),
+            })
+          )
+        })
+
+        it("should add tax inclusive promotion to cart successfully in a tax inclusive currency with 2 items and each allocation", async () => {
+          const publishableKey = await generatePublishableKey(appContainer)
+          const storeHeaders = generateStoreHeaders({ publishableKey })
+
+          const salesChannel = (
+            await api.post(
+              "/admin/sales-channels",
+              { name: "Webshop", description: "channel" },
+              adminHeaders
+            )
+          ).data.sales_channel
+
+          await api.post(
+            "/admin/price-preferences",
+            {
+              attribute: "currency_code",
+              value: "dkk",
+              is_tax_inclusive: true,
+            },
+            adminHeaders
+          )
+
+          const region = (
+            await api.post(
+              "/admin/regions",
+              {
+                name: "DK",
+                currency_code: "dkk",
+                countries: ["dk"],
+              },
+              adminHeaders
+            )
+          ).data.region
+
+          const product = (
+            await api.post(
+              "/admin/products",
+              {
+                title: "Discounted Medusa T-Shirt",
+                handle: "discounted-medusa-t-shirt",
+                options: [
+                  {
+                    title: "Size",
+                    values: ["S", "M"],
+                  },
+                ],
+                variants: [
+                  {
+                    title: "S",
+                    sku: "SHIRT-S",
+                    options: {
+                      Size: "S",
+                    },
+                    manage_inventory: false,
+                    prices: [
+                      {
+                        amount: 1000,
+                        currency_code: "dkk",
+                      },
+                    ],
+                  },
+                  {
+                    title: "M",
+                    sku: "SHIRT-M",
+                    options: {
+                      Size: "S",
+                    },
+                    manage_inventory: false,
+                    prices: [
+                      {
+                        amount: 500,
+                        currency_code: "dkk",
+                      },
+                    ],
+                  },
+                ],
+                shipping_profile_id: shippingProfile.id,
+              },
+              adminHeaders
+            )
+          ).data.product
+
+          const response = await api.post(
+            `/admin/promotions`,
+            {
+              code: "FIXED_10",
+              type: PromotionType.STANDARD,
+              status: PromotionStatus.ACTIVE,
+              is_tax_inclusive: true,
+              is_automatic: true,
+              application_method: {
+                target_type: "items",
+                type: "fixed",
+                allocation: "each",
+                currency_code: "DKK",
+                value: 100,
+                max_quantity: 2,
+              },
+            },
+            adminHeaders
+          )
+
+          expect(response.status).toEqual(200)
+          expect(response.data.promotion).toEqual(
+            expect.objectContaining({
+              id: expect.any(String),
+              code: "FIXED_10",
+              type: "standard",
+              is_tax_inclusive: true,
+              is_automatic: true,
+              application_method: expect.objectContaining({
+                value: 100,
+                type: "fixed",
+                target_type: "items",
+                allocation: "each",
+                max_quantity: 2,
+              }),
+            })
+          )
+
+          const cart = (
+            await api.post(
+              `/store/carts?fields=*items,*items.adjustments`,
+              {
+                currency_code: "dkk",
+                sales_channel_id: salesChannel.id,
+                region_id: region.id,
+                items: [
+                  {
+                    variant_id: product.variants[0].id,
+                    quantity: 1,
+                  },
+                  {
+                    variant_id: product.variants[1].id,
+                    quantity: 1,
+                  },
+                ],
+                promo_codes: [response.data.promotion.code],
+              },
+              storeHeaders
+            )
+          ).data.cart
+
+          /**
+           * Orignal total -> 1500 DKK (tax incl.)
+           * Promotion -> FIXED 100 DKK per item (tax incl.)
+           * Tax rate -> 25%
+           *
+           * We want total to be 1500 DKK - 100 DKK - 100 DKK = 1300 DKK
+           */
+          expect(cart).toEqual(
+            expect.objectContaining({
+              currency_code: "dkk",
+
+              total: 1300,
+              subtotal: 1200, // taxable base (item subtotal - discount subtotal) = 1200 - 200 = 1000
+              tax_total: 260,
+
+              discount_total: 200, // 2 * 100 DKK fixed tax inclusive
+              discount_subtotal: 160,
+              discount_tax_total: 40,
+
+              original_total: 1500,
+              original_tax_total: 300,
+
+              item_total: 1300,
+              item_subtotal: 1200,
+              item_tax_total: 260,
+
+              original_item_total: 1500,
+              original_item_subtotal: 1200,
+              original_item_tax_total: 300,
+
+              shipping_total: 0,
+              shipping_subtotal: 0,
+              shipping_tax_total: 0,
+
+              original_shipping_tax_total: 0,
+              original_shipping_subtotal: 0,
+              original_shipping_total: 0,
+
+              items: expect.arrayContaining([
+                expect.objectContaining({
+                  quantity: 1,
+                  unit_price: 500,
+
+                  subtotal: 400,
+                  total: 400, // 400 - 80 = 320 -> 320 * 1.25 = 400
+                  tax_total: 80,
+
+                  original_total: 500,
+                  original_tax_total: 100,
+
+                  discount_total: 100,
+                  discount_subtotal: 80,
+                  discount_tax_total: 20,
+
+                  adjustments: expect.arrayContaining([
+                    expect.objectContaining({
+                      amount: 100,
+                      is_tax_inclusive: true,
+                    }),
+                  ]),
+                }),
+                expect.objectContaining({
+                  quantity: 1,
+                  unit_price: 1000,
+
+                  subtotal: 800, // 800 - 80 = 720 -> 720 * 1.25 = 900
+                  total: 900,
+                  tax_total: 180,
+
+                  original_total: 1000,
+                  original_tax_total: 200,
+
+                  discount_total: 100,
+                  discount_subtotal: 80,
+                  discount_tax_total: 20,
+
+                  adjustments: expect.arrayContaining([
+                    expect.objectContaining({
+                      amount: 100,
+                      is_tax_inclusive: true,
+                    }),
+                  ]),
+                }),
+              ]),
+            })
+          )
+        })
+
+        it("should add tax exclusive promotion to cart successfully for tax inclusive currency", async () => {
+          const publishableKey = await generatePublishableKey(appContainer)
+          const storeHeaders = generateStoreHeaders({ publishableKey })
+
+          const salesChannel = (
+            await api.post(
+              "/admin/sales-channels",
+              { name: "Webshop", description: "channel" },
+              adminHeaders
+            )
+          ).data.sales_channel
+
+          await api.post(
+            "/admin/price-preferences",
+            {
+              attribute: "currency_code",
+              value: "dkk",
+              is_tax_inclusive: true,
+            },
+            adminHeaders
+          )
+
+          const region = (
+            await api.post(
+              "/admin/regions",
+              {
+                name: "DK",
+                currency_code: "dkk",
+                countries: ["dk"],
+              },
+              adminHeaders
+            )
+          ).data.region
+
+          const product = (
+            await api.post(
+              "/admin/products",
+              {
+                ...medusaTshirtProduct,
+                shipping_profile_id: shippingProfile.id,
+              },
+              adminHeaders
+            )
+          ).data.product
+
+          const response = await api.post(
+            `/admin/promotions`,
+            {
+              code: "FIXED_10",
+              type: PromotionType.STANDARD,
+              status: PromotionStatus.ACTIVE,
+              is_automatic: true,
+              application_method: {
+                target_type: "items",
+                type: "fixed",
+                allocation: "across",
+                currency_code: "DKK",
+                value: 100,
+              },
+            },
+            adminHeaders
+          )
+
+          expect(response.status).toEqual(200)
+          expect(response.data.promotion).toEqual(
+            expect.objectContaining({
+              id: expect.any(String),
+              code: "FIXED_10",
+              type: "standard",
+              is_tax_inclusive: false, // tax exclusive by default
+              is_automatic: true,
+              application_method: expect.objectContaining({
+                value: 100,
+                type: "fixed",
+                target_type: "items",
+                allocation: "across",
+              }),
+            })
+          )
+
+          const cart = (
+            await api.post(
+              `/store/carts?fields=*items,*items.adjustments`,
+              {
+                currency_code: "dkk",
+                sales_channel_id: salesChannel.id,
+                region_id: region.id,
+                items: [
+                  {
+                    variant_id: product.variants[0].id,
+                    quantity: 1,
+                  },
+                ],
+                promo_codes: [response.data.promotion.code],
+              },
+              storeHeaders
+            )
+          ).data.cart
+
+          /**
+           * Orignal total -> 1300 DKK (tax incl.)
+           * Tax rate -> 25%
+           * Promotion -> FIXED 100 DKK (tax exclusive !)
+           */
+          expect(cart).toEqual(
+            expect.objectContaining({
+              currency_code: "dkk",
+
+              subtotal: 1040, // taxable base (item subtotal - discount subtotal) = 1040 - 100 = 940
+              total: 1175, // total = taxable base * (1 + tax rate) = 940 * (1 + 0.25) = 1175
+              tax_total: 235,
+
+              original_total: 1300,
+              original_tax_total: 260,
+
+              discount_total: 100,
+              discount_subtotal: 100,
+              discount_tax_total: 20,
+
+              item_total: 1175,
+              item_subtotal: 1040,
+              item_tax_total: 235,
+
+              original_item_total: 1300,
+              original_item_subtotal: 1040,
+              original_item_tax_total: 260,
+
+              shipping_total: 0,
+              shipping_subtotal: 0,
+              shipping_tax_total: 0,
+
+              original_shipping_tax_total: 0,
+              original_shipping_subtotal: 0,
+              original_shipping_total: 0,
+
+              items: expect.arrayContaining([
+                expect.objectContaining({
+                  quantity: 1,
+                  unit_price: 1300,
+
+                  subtotal: 1040,
+                  tax_total: 235,
+                  total: 1175,
+
+                  original_total: 1300,
+                  original_tax_total: 260,
+
+                  discount_total: 100,
+                  discount_subtotal: 100,
+                  discount_tax_total: 20,
+
+                  adjustments: expect.arrayContaining([
+                    expect.objectContaining({
+                      amount: 100,
+                      is_tax_inclusive: false,
+                    }),
+                  ]),
+                }),
+              ]),
+            })
+          )
+        })
+
+        it("should add tax exclusive promotion to cart successfully for tax exclusive currency", async () => {
+          const publishableKey = await generatePublishableKey(appContainer)
+          const storeHeaders = generateStoreHeaders({ publishableKey })
+
+          const salesChannel = (
+            await api.post(
+              "/admin/sales-channels",
+              { name: "Webshop", description: "channel" },
+              adminHeaders
+            )
+          ).data.sales_channel
+
+          await api.post(
+            "/admin/price-preferences",
+            {
+              attribute: "currency_code",
+              value: "dkk",
+              is_tax_inclusive: false,
+            },
+            adminHeaders
+          )
+
+          const region = (
+            await api.post(
+              "/admin/regions",
+              {
+                name: "DK",
+                currency_code: "dkk",
+                countries: ["dk"],
+              },
+              adminHeaders
+            )
+          ).data.region
+
+          const product = (
+            await api.post(
+              "/admin/products",
+              {
+                ...medusaTshirtProduct,
+                shipping_profile_id: shippingProfile.id,
+              },
+              adminHeaders
+            )
+          ).data.product
+
+          const response = await api.post(
+            `/admin/promotions`,
+            {
+              code: "FIXED_10",
+              type: PromotionType.STANDARD,
+              status: PromotionStatus.ACTIVE,
+              is_automatic: true,
+              application_method: {
+                target_type: "items",
+                type: "fixed",
+                allocation: "across",
+                currency_code: "DKK",
+                value: 100,
+              },
+            },
+            adminHeaders
+          )
+
+          expect(response.status).toEqual(200)
+          expect(response.data.promotion).toEqual(
+            expect.objectContaining({
+              id: expect.any(String),
+              code: "FIXED_10",
+              type: "standard",
+              is_tax_inclusive: false, // tax exclusive by default
+              is_automatic: true,
+              application_method: expect.objectContaining({
+                value: 100,
+                type: "fixed",
+                target_type: "items",
+                allocation: "across",
+              }),
+            })
+          )
+
+          const cart = (
+            await api.post(
+              `/store/carts?fields=*items,*items.adjustments`,
+              {
+                currency_code: "dkk",
+                sales_channel_id: salesChannel.id,
+                region_id: region.id,
+                items: [
+                  {
+                    variant_id: product.variants[0].id,
+                    quantity: 1,
+                  },
+                ],
+                promo_codes: [response.data.promotion.code],
+              },
+              storeHeaders
+            )
+          ).data.cart
+
+          /**
+           * Orignal total -> 1300 DKK (tax excl.)
+           * Tax rate -> 25%
+           * Promotion -> FIXED 100 DKK (tax exclusive !)
+           */
+          expect(cart).toEqual(
+            expect.objectContaining({
+              currency_code: "dkk",
+
+              subtotal: 1300, // taxable base (item subtotal - discount subtotal) = 1300 - 100 = 1200
+              total: 1500, // total = taxable base * (1 + tax rate) = 1200 * (1 + 0.25) = 1500
+              tax_total: 300,
+
+              original_total: 1625,
+              original_tax_total: 325,
+
+              discount_total: 125,
+              discount_subtotal: 100,
+              discount_tax_total: 25,
+
+              item_total: 1500,
+              item_subtotal: 1300,
+              item_tax_total: 300,
+
+              original_item_total: 1625,
+              original_item_subtotal: 1300,
+              original_item_tax_total: 325,
+
+              shipping_total: 0,
+              shipping_subtotal: 0,
+              shipping_tax_total: 0,
+
+              original_shipping_tax_total: 0,
+              original_shipping_subtotal: 0,
+              original_shipping_total: 0,
+
+              items: expect.arrayContaining([
+                expect.objectContaining({
+                  quantity: 1,
+                  unit_price: 1300,
+
+                  subtotal: 1300,
+                  total: 1500,
+                  tax_total: 300,
+
+                  discount_total: 125,
+                  discount_subtotal: 100,
+                  discount_tax_total: 25,
+
+                  original_total: 1625,
+                  original_tax_total: 325,
+
+                  adjustments: expect.arrayContaining([
+                    expect.objectContaining({
+                      amount: 100,
+                      is_tax_inclusive: false,
+                    }),
+                  ]),
+                }),
+              ]),
+            })
+          )
+        })
       })
 
       describe("DELETE /admin/promotions/:id", () => {

packages/admin/dashboard/src/i18n/translations/$schema.json

@@ -7362,6 +7362,9 @@
             "clearAll": {
               "type": "string"
             },
+            "taxInclusive": {
+              "type": "string"
+            },
             "amount": {
               "type": "object",
               "properties": {
@@ -7428,6 +7431,7 @@
             "allocation",
             "addCondition",
             "clearAll",
+            "taxInclusive",
             "amount",
             "conditions"
           ],
@@ -7626,6 +7630,19 @@
               "required": ["existing", "new", "none"],
               "additionalProperties": false
             },
+            "taxInclusive": {
+              "type": "object",
+              "properties": {
+                "title": {
+                  "type": "string"
+                },
+                "description": {
+                  "type": "string"
+                }
+              },
+              "required": ["title", "description"],
+              "additionalProperties": false
+            },
             "status": {
               "type": "object",
               "properties": {
@@ -7852,6 +7869,7 @@
             "and",
             "selectAttribute",
             "campaign",
+            "taxInclusive",
             "status",
             "method",
             "max_quantity",

packages/admin/dashboard/src/i18n/translations/en.json

@@ -1969,6 +1969,7 @@
       "allocation": "Allocation",
       "addCondition": "Add condition",
       "clearAll": "Clear all",
+      "taxInclusive": "Tax Inclusive",
       "amount": {
         "tooltip": "Select the currency code to enable setting the amount"
       },
@@ -2045,6 +2046,10 @@
           "description": "Proceed without associating promotion with campaign"
         }
       },
+      "taxInclusive": {
+        "title": "Does promotion include taxes?",
+        "description": "Whether the promotion will be applied before or after taxes"
+      },
       "status": {
         "label": "Status",
         "draft": {

packages/admin/dashboard/src/routes/promotions/promotion-create/components/create-promotion-form/create-promotion-form.tsx

@@ -19,6 +19,7 @@ import {
   ProgressStatus,
   ProgressTabs,
   RadioGroup,
+  Switch,
   Text,
   toast,
 } from "@medusajs/ui"
@@ -52,6 +53,7 @@ const defaultValues = {
   type: "standard" as PromotionTypeValues,
   status: "draft" as PromotionStatusValues,
   rules: [],
+  is_tax_inclusive: false,
   application_method: {
     allocation: "each" as ApplicationMethodAllocationValues,
     type: "fixed" as ApplicationMethodTypeValues,
@@ -89,6 +91,7 @@ export const CreatePromotionForm = () => {
       const {
         campaign_choice: _campaignChoice,
         is_automatic,
+        is_tax_inclusive,
         template_id: _templateId,
         application_method,
         rules,
@@ -142,6 +145,7 @@ export const CreatePromotionForm = () => {
             target_rules: buildRulesData(targetRulesData),
             buy_rules: buildRulesData(buyRulesData),
           },
+          is_tax_inclusive,
           is_automatic: is_automatic === "true",
         },
         {
@@ -583,6 +587,49 @@ export const CreatePromotionForm = () => {
                     />
                   </div>
 
+                  {!currentTemplate?.hiddenFields?.includes(
+                    "is_tax_inclusive"
+                  ) && (
+                    <>
+                      <Divider />
+                      <div className="flex gap-x-2 gap-y-4">
+                        <Form.Field
+                          control={form.control}
+                          name="is_tax_inclusive"
+                          render={({
+                            field: { onChange, value, ...field },
+                          }) => {
+                            return (
+                              <Form.Item className="basis-full">
+                                <div className="flex items-center justify-between">
+                                  <div className="block">
+                                    <Form.Label>
+                                      {t("promotions.form.taxInclusive.title")}
+                                    </Form.Label>
+                                    <Form.Hint className="!mt-1">
+                                      {t(
+                                        "promotions.form.taxInclusive.description"
+                                      )}
+                                    </Form.Hint>
+                                  </div>
+                                  <Form.Control className="mr-2 self-center">
+                                    <Switch
+                                      className="mt-[2px]"
+                                      checked={!!value}
+                                      onCheckedChange={onChange}
+                                      {...field}
+                                    />
+                                  </Form.Control>
+                                </div>
+                                <Form.ErrorMessage />
+                              </Form.Item>
+                            )
+                          }}
+                        />
+                      </div>
+                    </>
+                  )}
+
                   {!currentTemplate?.hiddenFields?.includes("type") && (
                     <Form.Field
                       control={form.control}

packages/admin/dashboard/src/routes/promotions/promotion-create/components/create-promotion-form/form-schema.ts

@@ -27,6 +27,7 @@ export const CreatePromotionSchema = z
     type: z.enum(["buyget", "standard"]),
     status: z.enum(["draft", "active", "inactive"]),
     rules: RuleSchema,
+    is_tax_inclusive: z.boolean().optional(),
     application_method: z.object({
       allocation: z.enum(["each", "across"]),
       value: z.number().min(0),

packages/admin/dashboard/src/routes/promotions/promotion-create/components/create-promotion-form/templates.ts

@@ -74,7 +74,11 @@ export const templates = [
     type: "buy_get",
     title: "Buy X Get Y",
     description: "Buy X product(s), get Y product(s)",
-    hiddenFields: [...commonHiddenFields, "application_method.value"],
+    hiddenFields: [
+      ...commonHiddenFields,
+      "application_method.value",
+      "is_tax_inclusive",
+    ],
     defaults: {
       is_automatic: "false",
       type: "buyget",

packages/admin/dashboard/src/routes/promotions/promotion-detail/components/promotion-general-section/promotion-general-section.tsx

@@ -180,6 +180,18 @@ export const PromotionGeneralSection = ({
           {promotion.application_method?.allocation!}
         </Text>
       </div>
+
+      <div className="text-ui-fg-subtle grid grid-cols-2 items-start px-6 py-4">
+        <Text size="small" weight="plus" leading="compact">
+          {t("promotions.fields.taxInclusive")}
+        </Text>
+
+        <div className="flex items-center gap-x-2">
+          <Text className="inline" size="small" leading="compact">
+            {promotion.is_tax_inclusive ? t("fields.true") : t("fields.false")}
+          </Text>
+        </div>
+      </div>
     </Container>
   )
 }

packages/core/core-flows/src/cart/steps/prepare-adjustments-from-promotion-actions.ts

@@ -132,6 +132,7 @@ export const prepareAdjustmentsFromPromotionActionsStep = createStep(
       .map((action) => ({
         code: action.code,
         amount: (action as AddItemAdjustmentAction).amount,
+        is_tax_inclusive: (action as AddItemAdjustmentAction).is_tax_inclusive,
         item_id: (action as AddItemAdjustmentAction).item_id,
         promotion_id: promotionsMap.get(action.code)?.id,
       }))

packages/core/types/src/cart/common.ts

@@ -22,6 +22,11 @@ export interface AdjustmentLineDTO {
    */
   amount: BigNumberValue
 
+  /**
+   * Whether the adjustment is tax inclusive.
+   */
+  is_tax_inclusive?: boolean
+
   /**
    * The raw amount to adjust the original amount with.
    */

packages/core/types/src/cart/mutations.ts

@@ -236,6 +236,11 @@ export interface CreateAdjustmentDTO {
    */
   amount: BigNumberInput
 
+  /**
+   * Whether the adjustment amount includes tax.
+   */
+  is_tax_inclusive?: boolean
+
   /**
    * The description of the adjustment.
    */

packages/core/types/src/http/promotion/admin/payloads.ts

@@ -10,8 +10,8 @@ import { AdminCreateCampaign } from "../../campaign"
 
 export interface AdminCreatePromotionRule {
   /**
-   * The operator used to check whether the buy rule applies on a cart. 
+   * The operator used to check whether the buy rule applies on a cart.
-   * For example, `eq` means that the cart's value for the specified attribute 
+   * For example, `eq` means that the cart's value for the specified attribute
    * must match the specified value.
    */
   operator: PromotionRuleOperatorValues
@@ -21,14 +21,14 @@ export interface AdminCreatePromotionRule {
   description?: string | null
   /**
    * The attribute to compare against when checking whether a promotion can be applied on a cart.
-   * 
+   *
    * @example
    * items.product_id
    */
   attribute: string
   /**
    * The value to compare against when checking whether a promotion can be applied on a cart.
-   * 
+   *
    * @example
    * prod_123
    */
@@ -54,7 +54,7 @@ export interface AdminCreateApplicationMethod {
   value: number
   /**
    * The currency code of the application method.
-   * 
+   *
    * @example
    * usd
    */
@@ -68,12 +68,12 @@ export interface AdminCreateApplicationMethod {
    */
   type: ApplicationMethodTypeValues
   /**
-   * The target type of the application method indicating whether the associated promotion is applied 
+   * The target type of the application method indicating whether the associated promotion is applied
    * to the cart's items, shipping methods, or the whole order.
    */
   target_type: ApplicationMethodTargetTypeValues
   /**
-   * The allocation value that indicates whether the associated promotion is applied on each 
+   * The allocation value that indicates whether the associated promotion is applied on each
    * item in a cart or split between the items in the cart.
    */
   allocation?: ApplicationMethodAllocationValues
@@ -90,7 +90,7 @@ export interface AdminCreateApplicationMethod {
    */
   apply_to_quantity?: number | null
   /**
-   * The minimum quantity required for a `buyget` promotion to be applied. For example, 
+   * The minimum quantity required for a `buyget` promotion to be applied. For example,
    * if the promotion is a "Buy 2 shirts get 1 free", the value of this attribute is 2.
    */
   buy_rules_min_quantity?: number | null
@@ -111,7 +111,7 @@ export interface AdminUpdateApplicationMethod {
   max_quantity?: number | null
   /**
    * The currency code of the application method.
-   * 
+   *
    * @example
    * usd
    */
@@ -121,12 +121,12 @@ export interface AdminUpdateApplicationMethod {
    */
   type?: ApplicationMethodTypeValues
   /**
-   * The target type of the application method indicating whether the associated promotion is applied 
+   * The target type of the application method indicating whether the associated promotion is applied
    * to the cart's items, shipping methods, or the whole order.
    */
   target_type?: ApplicationMethodTargetTypeValues
   /**
-   * The allocation value that indicates whether the associated promotion is applied on each 
+   * The allocation value that indicates whether the associated promotion is applied on each
    * item in a cart or split between the items in the cart.
    */
   allocation?: ApplicationMethodAllocationValues
@@ -143,7 +143,7 @@ export interface AdminUpdateApplicationMethod {
    */
   apply_to_quantity?: number | null
   /**
-   * The minimum quantity required for a `buyget` promotion to be applied. For example, 
+   * The minimum quantity required for a `buyget` promotion to be applied. For example,
    * if the promotion is a "Buy 2 shirts get 1 free", the value of this attribute is 2.
    */
   buy_rules_min_quantity?: number | null
@@ -155,11 +155,15 @@ export interface AdminCreatePromotion {
    */
   code: string
   /**
-   * Whether the promotion is applied automatically 
+   * Whether the promotion is applied automatically
    * or requires the customer to manually apply it
    * by entering the code at checkout.
    */
   is_automatic?: boolean
+  /**
+   * Whether the promotion is tax inclusive.
+   */
+  is_tax_inclusive?: boolean
   /**
    * The type of promotion.
    */
@@ -188,7 +192,7 @@ export interface AdminUpdatePromotion {
    */
   code?: string
   /**
-   * Whether the promotion is applied automatically 
+   * Whether the promotion is applied automatically
    * or requires the customer to manually apply it
    * by entering the code at checkout.
    */

packages/core/types/src/http/promotion/common.ts

@@ -19,23 +19,23 @@ export interface BasePromotionRule {
   description?: string | null
   /**
    * The attribute to compare against when checking whether a promotion can be applied on a cart.
-   * 
+   *
    * @example
    * items.product_id
    */
   attribute?: string
   /**
-   * The operator used to check whether the buy rule applies on a cart. 
+   * The operator used to check whether the buy rule applies on a cart.
-   * For example, `eq` means that the cart's value for the specified attribute 
+   * For example, `eq` means that the cart's value for the specified attribute
    * must match the specified value.
-   * 
+   *
    * @example
    * eq
    */
   operator?: PromotionRuleOperatorValues
   /**
    * The values to compare against when checking whether a promotion can be applied on a cart.
-   * 
+   *
    * @example
    * prod_123
    */
@@ -62,6 +62,7 @@ export interface BasePromotion {
   code?: string
   type?: PromotionTypeValues
   is_automatic?: boolean
+  is_tax_inclusive?: boolean
   application_method?: BaseApplicationMethod
   rules?: BasePromotionRule[]
   status?: PromotionStatusValues

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

@@ -60,6 +60,12 @@ export interface AddItemAdjustmentAction {
    */
   amount: BigNumberInput
 
+  /**
+   * Whether the adjustment amount includes tax.
+   */
+  is_tax_inclusive?: boolean
+
+  /**
   /**
    * The promotion's code.
    */

packages/core/types/src/promotion/common/promotion.ts

@@ -60,6 +60,11 @@ export interface PromotionDTO {
    */
   is_automatic?: boolean
 
+  /**
+   * Whether the promotion is tax inclusive.
+   */
+  is_tax_inclusive?: boolean
+
   /**
    * The associated application method.
    */
@@ -113,6 +118,11 @@ export interface CreatePromotionDTO {
    */
   is_automatic?: boolean
 
+  /**
+   * Whether the promotion is tax inclusive.
+   */
+  is_tax_inclusive?: boolean
+
   /**
    * The associated application method.
    */

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

@@ -557,6 +557,96 @@ describe("Total calculation", function () {
     })
   })
 
+  it("should calculate tax inclusive carts with items + taxes with tax inclusive adjustments", function () {
+    /**
+     * TAX INCLUSIVE CART
+     *
+     * Total price -> 120 tax inclusive
+     * Fixed discount -> 10 tax inclusive
+     * Tax rate -> 20%
+     */
+
+    const cart = {
+      items: [
+        {
+          unit_price: 60,
+          quantity: 2,
+          is_tax_inclusive: true,
+          adjustments: [
+            {
+              amount: 10,
+              is_tax_inclusive: true,
+            },
+          ],
+          tax_lines: [
+            {
+              rate: 20,
+            },
+          ],
+        },
+      ],
+    }
+
+    const serialized = JSON.parse(JSON.stringify(decorateCartTotals(cart)))
+
+    expect(serialized).toEqual({
+      items: [
+        {
+          unit_price: 60,
+          quantity: 2,
+          subtotal: 100,
+          tax_total: 18.333333333333332,
+          total: 110,
+          is_tax_inclusive: true,
+
+          original_total: 120,
+          original_tax_total: 20,
+
+          discount_subtotal: 8.333333333333334,
+          discount_tax_total: 1.6666666666666667,
+          discount_total: 10,
+
+          tax_lines: [
+            {
+              rate: 20,
+              total: 18.333333333333332,
+              subtotal: 20,
+            },
+          ],
+          adjustments: [
+            {
+              is_tax_inclusive: true,
+              amount: 10, // <- amount is tax inclusive so it's equal to total
+              subtotal: 8.333333333333334,
+              total: 10,
+            },
+          ],
+        },
+      ],
+      subtotal: 100,
+      tax_total: 18.333333333333332,
+      total: 110, // total is 120 - 10 tax inclusive discount
+
+      original_item_subtotal: 100,
+      original_item_tax_total: 20,
+      original_item_total: 120,
+      original_tax_total: 20,
+      original_total: 120,
+
+      discount_subtotal: 8.333333333333334,
+      discount_tax_total: 1.6666666666666667,
+      discount_total: 10,
+
+      item_subtotal: 100,
+      item_tax_total: 18.333333333333332,
+      item_total: 110,
+
+      credit_line_subtotal: 0,
+      credit_line_tax_total: 0,
+      credit_line_total: 0,
+    })
+  })
+
   it("should calculate carts with items + taxes + adjustments + shipping methods", function () {
     const cart = {
       items: [

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

@@ -8,7 +8,7 @@ export function calculateAdjustmentTotal({
   includesTax,
   taxRate,
 }: {
-  adjustments: Pick<AdjustmentLineDTO, "amount">[]
+  adjustments: Pick<AdjustmentLineDTO, "amount" | "is_tax_inclusive">[]
   includesTax?: boolean
   taxRate?: BigNumberInput
 }) {
@@ -25,7 +25,15 @@ export function calculateAdjustmentTotal({
     }
 
     const adjustmentAmount = MathBN.convert(adj.amount)
-    adjustmentsSubtotal = MathBN.add(adjustmentsSubtotal, adjustmentAmount)
+
+    if (adj.is_tax_inclusive && isDefined(taxRate)) {
+      adjustmentsSubtotal = MathBN.add(
+        adjustmentsSubtotal,
+        MathBN.div(adjustmentAmount, MathBN.add(1, taxRate))
+      )
+    } else {
+      adjustmentsSubtotal = MathBN.add(adjustmentsSubtotal, adjustmentAmount)
+    }
 
     if (isDefined(taxRate)) {
       const adjustmentSubtotal = includesTax

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

@@ -22,7 +22,7 @@ export interface DecorateCartLikeInputDTO {
     unit_price: BigNumberInput
     is_tax_inclusive?: boolean
     quantity: BigNumberInput
-    adjustments?: { amount: BigNumberInput }[]
+    adjustments?: { amount: BigNumberInput; is_tax_inclusive?: boolean }[]
     tax_lines?: {
       rate: BigNumberInput
     }[]

packages/medusa/src/api/admin/promotions/query-config.ts

@@ -2,6 +2,7 @@ export const defaultAdminPromotionFields = [
   "id",
   "code",
   "is_automatic",
+  "is_tax_inclusive",
   "type",
   "status",
   "created_at",

packages/medusa/src/api/admin/promotions/validators.ts

@@ -163,6 +163,7 @@ export const CreatePromotion = z
     code: z.string(),
     is_automatic: z.boolean().optional(),
     type: z.nativeEnum(PromotionType),
+    is_tax_inclusive: z.boolean().optional(),
     status: z.nativeEnum(PromotionStatus).default(PromotionStatus.DRAFT),
     campaign_id: z.string().nullish(),
     campaign: CreateCampaign.optional(),

packages/modules/cart/integration-tests/__tests__/services/cart-module/index.spec.ts

@@ -2913,6 +2913,7 @@ moduleIntegrationTestRunner<ICartModuleService>({
                 created_at: expect.any(String),
                 updated_at: expect.any(String),
                 item_id: expect.any(String),
+                is_tax_inclusive: false,
                 promotion_id: null,
                 deleted_at: null,
                 amount: 100,
@@ -3020,6 +3021,7 @@ moduleIntegrationTestRunner<ICartModuleService>({
                 created_at: expect.any(String),
                 updated_at: expect.any(String),
                 item_id: expect.any(String),
+                is_tax_inclusive: false,
                 promotion_id: null,
                 deleted_at: null,
                 amount: 200,

packages/modules/cart/src/migrations/.snapshot-medusa-cart.json

@@ -998,6 +998,16 @@
           "nullable": false,
           "mappedType": "decimal"
         },
+        "is_tax_inclusive": {
+          "name": "is_tax_inclusive",
+          "type": "boolean",
+          "unsigned": false,
+          "autoincrement": false,
+          "primary": false,
+          "nullable": false,
+          "default": "false",
+          "mappedType": "boolean"
+        },
         "provider_id": {
           "name": "provider_id",
           "type": "text",

packages/modules/cart/src/migrations/Migration20250508081553.ts

@@ -0,0 +1,13 @@
+import { Migration } from '@mikro-orm/migrations';
+
+export class Migration20250508081553 extends Migration {
+
+  override async up(): Promise<void> {
+    this.addSql(`alter table if exists "cart_line_item_adjustment" add column if not exists "is_tax_inclusive" boolean not null default false;`);
+  }
+
+  override async down(): Promise<void> {
+    this.addSql(`alter table if exists "cart_line_item_adjustment" drop column if exists "is_tax_inclusive";`);
+  }
+
+}

packages/modules/cart/src/models/line-item-adjustment.ts

@@ -9,6 +9,7 @@ const LineItemAdjustment = model
       description: model.text().nullable(),
       code: model.text().nullable(),
       amount: model.bigNumber(),
+      is_tax_inclusive: model.boolean().default(false),
       provider_id: model.text().nullable(),
       promotion_id: model.text().nullable(),
       metadata: model.json().nullable(),

packages/modules/promotion/integration-tests/__tests__/services/promotion-module/compute-actions.spec.ts

@@ -189,12 +189,14 @@ moduleIntegrationTestRunner({
                 item_id: "item_cotton_tshirt",
                 amount: 100,
                 code: "PROMOTION_TEST",
+                is_tax_inclusive: false,
               },
               {
                 action: "addItemAdjustment",
                 item_id: "item_cotton_sweater",
                 amount: 150,
                 code: "PROMOTION_TEST",
+                is_tax_inclusive: false,
               },
             ])
 
@@ -326,18 +328,21 @@ moduleIntegrationTestRunner({
                 item_id: "item_cotton_tshirt",
                 amount: 50,
                 code: "PROMOTION_TEST_2",
+                is_tax_inclusive: false,
               },
               {
                 action: "addItemAdjustment",
                 item_id: "item_cotton_sweater",
                 amount: 50,
                 code: "PROMOTION_TEST_2",
+                is_tax_inclusive: false,
               },
               {
                 action: "addItemAdjustment",
                 item_id: "item_cotton_sweater",
                 amount: 30,
                 code: "PROMOTION_TEST",
+                is_tax_inclusive: false,
               },
             ])
           })
@@ -434,12 +439,14 @@ moduleIntegrationTestRunner({
                 item_id: "item_cotton_tshirt",
                 amount: 50,
                 code: "PROMOTION_TEST",
+                is_tax_inclusive: false,
               },
               {
                 action: "addItemAdjustment",
                 item_id: "item_cotton_sweater",
                 amount: 150,
                 code: "PROMOTION_TEST",
+                is_tax_inclusive: false,
               },
             ])
           })
@@ -497,6 +504,7 @@ moduleIntegrationTestRunner({
                 item_id: "item_cotton_tshirt",
                 amount: 500,
                 code: "PROMOTION_TEST",
+                is_tax_inclusive: false,
               },
             ])
           })
@@ -624,12 +632,14 @@ moduleIntegrationTestRunner({
                 item_id: "item_cotton_tshirt",
                 amount: 10,
                 code: "PROMOTION_TEST",
+                is_tax_inclusive: false,
               },
               {
                 action: "addItemAdjustment",
                 item_id: "item_cotton_sweater",
                 amount: 15,
                 code: "PROMOTION_TEST",
+                is_tax_inclusive: false,
               },
             ])
           })
@@ -726,24 +736,28 @@ moduleIntegrationTestRunner({
                 item_id: "item_cotton_tshirt",
                 amount: 30,
                 code: "PROMOTION_TEST",
+                is_tax_inclusive: false,
               },
               {
                 action: "addItemAdjustment",
                 item_id: "item_cotton_sweater",
                 amount: 45,
                 code: "PROMOTION_TEST",
+                is_tax_inclusive: false,
               },
               {
                 action: "addItemAdjustment",
                 item_id: "item_cotton_tshirt",
                 amount: 5,
                 code: "PROMOTION_TEST_2",
+                is_tax_inclusive: false,
               },
               {
                 action: "addItemAdjustment",
                 item_id: "item_cotton_sweater",
                 amount: 10.5,
                 code: "PROMOTION_TEST_2",
+                is_tax_inclusive: false,
               },
             ])
           })
@@ -813,12 +827,14 @@ moduleIntegrationTestRunner({
                 item_id: "item_cotton_tshirt",
                 amount: 50,
                 code: "PROMO_PERCENTAGE_1",
+                is_tax_inclusive: false,
               },
               {
                 action: "addItemAdjustment",
                 item_id: "item_cotton_tshirt",
                 amount: 50,
                 code: "PROMO_PERCENTAGE_2",
+                is_tax_inclusive: false,
               },
             ])
           })
@@ -915,12 +931,14 @@ moduleIntegrationTestRunner({
                 item_id: "item_cotton_tshirt",
                 amount: 50,
                 code: "PROMOTION_TEST",
+                is_tax_inclusive: false,
               },
               {
                 action: "addItemAdjustment",
                 item_id: "item_cotton_sweater",
                 amount: 150,
                 code: "PROMOTION_TEST",
+                is_tax_inclusive: false,
               },
             ])
           })
@@ -1103,12 +1121,14 @@ moduleIntegrationTestRunner({
                 item_id: "item_cotton_tshirt",
                 amount: 100,
                 code: "PROMOTION_TEST",
+                is_tax_inclusive: false,
               },
               {
                 action: "addItemAdjustment",
                 item_id: "item_cotton_sweater",
                 amount: 300,
                 code: "PROMOTION_TEST",
+                is_tax_inclusive: false,
               },
             ])
           })
@@ -1177,12 +1197,14 @@ moduleIntegrationTestRunner({
                 item_id: "item_cotton_tshirt",
                 amount: 100,
                 code: "PROMOTION_TEST",
+                is_tax_inclusive: false,
               },
               {
                 action: "addItemAdjustment",
                 item_id: "item_cotton_sweater",
                 amount: 300,
                 code: "PROMOTION_TEST",
+                is_tax_inclusive: false,
               },
             ])
           })
@@ -1278,24 +1300,28 @@ moduleIntegrationTestRunner({
                 item_id: "item_cotton_tshirt",
                 amount: 12.5,
                 code: "PROMOTION_TEST_2",
+                is_tax_inclusive: false,
               },
               {
                 action: "addItemAdjustment",
                 item_id: "item_cotton_sweater",
                 amount: 37.5,
                 code: "PROMOTION_TEST_2",
+                is_tax_inclusive: false,
               },
               {
                 action: "addItemAdjustment",
                 item_id: "item_cotton_tshirt",
                 amount: 7.5,
                 code: "PROMOTION_TEST",
+                is_tax_inclusive: false,
               },
               {
                 action: "addItemAdjustment",
                 item_id: "item_cotton_sweater",
                 amount: 22.5,
                 code: "PROMOTION_TEST",
+                is_tax_inclusive: false,
               },
             ])
           })
@@ -1391,12 +1417,14 @@ moduleIntegrationTestRunner({
                 item_id: "item_cotton_tshirt",
                 amount: 50,
                 code: "PROMOTION_TEST",
+                is_tax_inclusive: false,
               },
               {
                 action: "addItemAdjustment",
                 item_id: "item_cotton_sweater",
                 amount: 150,
                 code: "PROMOTION_TEST",
+                is_tax_inclusive: false,
               },
             ])
           })
@@ -1574,12 +1602,14 @@ moduleIntegrationTestRunner({
                 item_id: "item_cotton_tshirt",
                 amount: 20,
                 code: "PROMOTION_TEST",
+                is_tax_inclusive: false,
               },
               {
                 action: "addItemAdjustment",
                 item_id: "item_cotton_sweater",
                 amount: 60,
                 code: "PROMOTION_TEST",
+                is_tax_inclusive: false,
               },
             ])
           })
@@ -1648,12 +1678,14 @@ moduleIntegrationTestRunner({
                 item_id: "item_cotton_tshirt",
                 amount: 20,
                 code: "PROMOTION_TEST",
+                is_tax_inclusive: false,
               },
               {
                 action: "addItemAdjustment",
                 item_id: "item_cotton_sweater",
                 amount: 60,
                 code: "PROMOTION_TEST",
+                is_tax_inclusive: false,
               },
             ])
           })
@@ -1748,24 +1780,28 @@ moduleIntegrationTestRunner({
                 item_id: "item_cotton_tshirt",
                 amount: 5,
                 code: "PROMOTION_TEST",
+                is_tax_inclusive: false,
               },
               {
                 action: "addItemAdjustment",
                 item_id: "item_cotton_sweater",
                 amount: 15,
                 code: "PROMOTION_TEST",
+                is_tax_inclusive: false,
               },
               {
                 action: "addItemAdjustment",
                 item_id: "item_cotton_tshirt",
                 amount: 4.5,
                 code: "PROMOTION_TEST_2",
+                is_tax_inclusive: false,
               },
               {
                 action: "addItemAdjustment",
                 item_id: "item_cotton_sweater",
                 amount: 13.5,
                 code: "PROMOTION_TEST_2",
+                is_tax_inclusive: false,
               },
             ])
           })
@@ -1838,24 +1874,28 @@ moduleIntegrationTestRunner({
                 item_id: "item_cotton_tshirt",
                 amount: 150,
                 code: "PROMO_PERCENTAGE_1",
+                is_tax_inclusive: false,
               },
               {
                 action: "addItemAdjustment",
                 item_id: "item_wool_tshirt",
                 amount: 50,
                 code: "PROMO_PERCENTAGE_1",
+                is_tax_inclusive: false,
               },
               {
                 action: "addItemAdjustment",
                 item_id: "item_cotton_tshirt",
                 amount: 75,
                 code: "PROMO_PERCENTAGE_2",
+                is_tax_inclusive: false,
               },
               {
                 action: "addItemAdjustment",
                 item_id: "item_wool_tshirt",
                 amount: 25,
                 code: "PROMO_PERCENTAGE_2",
+                is_tax_inclusive: false,
               },
             ])
 
@@ -1914,12 +1954,14 @@ moduleIntegrationTestRunner({
                 item_id: "item_cotton_tshirt",
                 amount: 300,
                 code: "PROMO_PERCENTAGE_3",
+                is_tax_inclusive: false,
               },
               {
                 action: "addItemAdjustment",
                 item_id: "item_wool_tshirt",
                 amount: 100,
                 code: "PROMO_PERCENTAGE_3",
+                is_tax_inclusive: false,
               },
             ])
           })
@@ -2014,24 +2056,28 @@ moduleIntegrationTestRunner({
                 item_id: "item_cotton_tshirt",
                 amount: 5,
                 code: "PROMOTION_TEST",
+                is_tax_inclusive: false,
               },
               {
                 action: "addItemAdjustment",
                 item_id: "item_cotton_sweater",
                 amount: 15,
                 code: "PROMOTION_TEST",
+                is_tax_inclusive: false,
               },
               {
                 action: "addItemAdjustment",
                 item_id: "item_cotton_tshirt",
                 amount: 4.5,
                 code: "PROMOTION_TEST_2",
+                is_tax_inclusive: false,
               },
               {
                 action: "addItemAdjustment",
                 item_id: "item_cotton_sweater",
                 amount: 13.5,
                 code: "PROMOTION_TEST_2",
+                is_tax_inclusive: false,
               },
             ])
           })
@@ -4174,12 +4220,14 @@ moduleIntegrationTestRunner({
               item_id: "item_cotton_tshirt",
               amount: 50,
               code: "PROMOTION_TEST",
+              is_tax_inclusive: false,
             },
             {
               action: "addItemAdjustment",
               item_id: "item_cotton_sweater",
               amount: 150,
               code: "PROMOTION_TEST",
+              is_tax_inclusive: false,
             },
           ])
         })
@@ -4241,12 +4289,14 @@ moduleIntegrationTestRunner({
               item_id: "item_cotton_tshirt",
               amount: 50,
               code: "PROMOTION_TEST",
+              is_tax_inclusive: false,
             },
             {
               action: "addItemAdjustment",
               item_id: "item_cotton_sweater",
               amount: 150,
               code: "PROMOTION_TEST",
+              is_tax_inclusive: false,
             },
           ])
         })
@@ -4329,24 +4379,28 @@ moduleIntegrationTestRunner({
               item_id: "item_cotton_tshirt",
               amount: 12.5,
               code: "PROMOTION_TEST_2",
+              is_tax_inclusive: false,
             },
             {
               action: "addItemAdjustment",
               item_id: "item_cotton_sweater",
               amount: 37.5,
               code: "PROMOTION_TEST_2",
+              is_tax_inclusive: false,
             },
             {
               action: "addItemAdjustment",
               item_id: "item_cotton_tshirt",
               amount: 7.5,
               code: "PROMOTION_TEST",
+              is_tax_inclusive: false,
             },
             {
               action: "addItemAdjustment",
               item_id: "item_cotton_sweater",
               amount: 22.5,
               code: "PROMOTION_TEST",
+              is_tax_inclusive: false,
             },
           ])
         })
@@ -4429,12 +4483,14 @@ moduleIntegrationTestRunner({
               item_id: "item_cotton_tshirt",
               amount: 50,
               code: "PROMOTION_TEST",
+              is_tax_inclusive: false,
             },
             {
               action: "addItemAdjustment",
               item_id: "item_cotton_sweater",
               amount: 150,
               code: "PROMOTION_TEST",
+              is_tax_inclusive: false,
             },
           ])
         })
@@ -4519,12 +4575,14 @@ moduleIntegrationTestRunner({
               item_id: "item_cotton_tshirt",
               amount: 100,
               code: "PROMOTION_TEST",
+              is_tax_inclusive: false,
             },
             {
               action: "addItemAdjustment",
               item_id: "item_cotton_sweater",
               amount: 150,
               code: "PROMOTION_TEST",
+              is_tax_inclusive: false,
             },
           ])
         })

packages/modules/promotion/src/migrations/.snapshot-medusa-promotion.json

@@ -332,6 +332,16 @@
           "default": "false",
           "mappedType": "boolean"
         },
+        "is_tax_inclusive": {
+          "name": "is_tax_inclusive",
+          "type": "boolean",
+          "unsigned": false,
+          "autoincrement": false,
+          "primary": false,
+          "nullable": false,
+          "default": "false",
+          "mappedType": "boolean"
+        },
         "type": {
           "name": "type",
           "type": "text",

packages/modules/promotion/src/migrations/Migration20250508081510.ts

@@ -0,0 +1,15 @@
+import { Migration } from "@mikro-orm/migrations"
+
+export class Migration20250508081510 extends Migration {
+  override async up(): Promise<void> {
+    this.addSql(
+      `alter table if exists "promotion" add column if not exists "is_tax_inclusive" boolean not null default false;`
+    )
+  }
+
+  override async down(): Promise<void> {
+    this.addSql(
+      `alter table if exists "promotion" drop column if exists "is_tax_inclusive";`
+    )
+  }
+}

packages/modules/promotion/src/models/promotion.ts

@@ -8,6 +8,7 @@ const Promotion = model
     id: model.id({ prefix: "promo" }).primaryKey(),
     code: model.text().searchable(),
     is_automatic: model.boolean().default(false),
+    is_tax_inclusive: model.boolean().default(false),
     type: model.enum(PromotionUtils.PromotionType).index("IDX_promotion_type"),
     status: model
       .enum(PromotionUtils.PromotionStatus)

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

@@ -164,6 +164,7 @@ function applyPromotionToItems(
         item_id: item.id,
         amount,
         code: promotion.code!,
+        is_tax_inclusive: promotion.is_tax_inclusive,
       })
     } else if (isTargetShippingMethod) {
       computedActions.push({