Why is GST being calculated on the original price instead of the discounted value?

This happens when order-level discounts are not distributed across individual line items. By default, GST Pro calculates tax on the original product price unless the setting to split order discounts into line items is enabled.

Most Common Root Cause

Order-level discounts are not split into line items

When a discount is applied to the entire order (for example, a ₹100 discount on the cart):

Shopify records the product price as the original amount
GST Pro calculates tax on that original value
The discount is applied after tax unless instructed otherwise

GST Pro needs explicit permission to distribute the discount across products.

Other Possible Causes

1 Discounts applied outside Shopify

Discounts created via third-party checkouts or payment gateways (for example, Razorpay or Shopflo)
May not sync into Shopify's order summary
GST Pro cannot calculate tax on discounts it cannot "see"

2 "Compare at price" misunderstanding

The Compare at price is only a reference (MRP)
Shopify does not treat it as a transactional discount
GST continues to be calculated on the actual Price field

3 "Compare at price as rate" setting enabled

If Compare at price as rate is turned on in tax settings
The invoice may show MRP as the rate
This can look like GST is calculated on a higher value than expected

Why This Happens

GST Pro calculates tax based on what Shopify sends in the order data.

Example:
○ Product price: ₹1000
○ Order-level discount: ₹100
By default:
○ GST is calculated on ₹1000
○ Discount is applied later

When discount splitting is enabled, the ₹100 discount is distributed across items, each item's taxable value is reduced, and GST is calculated only on the final amount paid.

How We Typically Resolve This

1

Enable discount splitting in GST Pro

Path: GST Pro → Settings → Taxes

Turn ON "Split order discounts to individual line items"
Also shown as "Distribute order discount to line items"
Click Save

2

Verify changes take effect

GST is calculated on the discounted value
Changes usually reflect immediately on:

Once enabled:

New invoices

Existing invoices (where supported)

Important Dependencies & Limitations

GST Pro cannot modify what the customer paid at checkout
If Shopify order data does not include a discount:
○ GST Pro cannot infer or recalculate it
Discounts created entirely outside Shopify:
○ May not be visible to the app
Tax calculation depends on:
○ Shopify Order API
○ Correct GST rates configured inside GST Pro

What This Will NOT Fix

Discounts not recorded in Shopify orders
Compare at price used as a fake discount
Tax errors caused by third-party checkout overrides