# Discount types

Source: https://developer.avalara.com/products/communications/integration-guides/communications-integration/oft4867042856103/

Guide: Communications

# Discount types

When created adjusted transactions, use one of the discounts types (`disc`) listed in the table below. If discounts don’t apply, or if you're unsure, set this value to`0`.

Discounts may or may not be taxed within each state. When a discount is taxed, the customer receives a tax benefit commensurate with the amount of the discount. (For example, if the customer gets $5 off on a transaction subject to a 5% tax, the customer pays $0.25 less in tax than they would have.)

When a discount isn’t taxed, the customer receives no tax benefit from the discount. Whether a discount is taxed or not depends on the type of discount and the rules in the particular tax jurisdiction.

Note

Using a discount type other than 0 (None) may result in a $0.00 tax calculation because some jurisdictions don't allow tax refunds for other discount types.

Table 1. 

Discount name

Value

Description

None (default)

`0`

Not defined. AFC engine will return negative tax.

Retail product

`1`

Promotional pricing, customer discounts and/or coupons that result in a reduction of price in goods

Manufacturer rebate

`2`

A credit applied to the total amount reimbursed to either the retailer or the customer by the manufacturer

Account level

`3`

A deduction in the tax amount based on reasons such as bad debt write offs or billing corrections.

Subsidized

`4`

Government credits such as for a telephone service where the provider provides a service to a lifeline eligible customer for a subscriber line charge.

Goodwill

`5`

A credit applied to a customer's invoice for the purpose of good will, for example compensation for a service outage.