I have strange behaviour which has always existed in my magento as far as I am aware.

I have a tax rule of 20% for all products so prices are input without tax.

When creating a Percentage discount in Promotions > shopping cart price rules>

Under Actions tab I am choosing 'percentage of product price" option.

I am setting value to 7%.

When I use the coupon the discounted amount seems work out 20% more. E.g 7x1.2 = 8.2%

So for a real example I have a product with price 519. I apply 7% coupon and the final price is 475.40.

519 to 475.40 is in fact a difference of 8.38%

This happens to all products with regular price and special prices.

I also have this issue with fixed price discounts.

If I want to have a discount of £5 I have to make the value in the shopping cart price rule 4.166. Is this normal behaviour for magento?

I could not find anyone posting about this exact issue anywhere. Maybe I am wording it wrong in my searches.

Now onto my tax settings in system>configuration>sales>tax

Please see image below.

enter image description here

Any help would be much appreciated.

  • I'm not sure it leads to a direct answer, but you say that your prices are input without tax (I have a tax rule of 20% for all products so prices are input without tax.), however Calculation Settings > Catalog Prices is set to includes tax, that doesn't sound right. Feb 23, 2015 at 21:08
  • I just changed the setting to 'excludes tax' cleared cache reindexed I still seem to have the issue. Feb 23, 2015 at 22:43

1 Answer 1


It sounds like your issue is that your discounts are applying to products that already have the 20% tax added to them. If this is the issue, you can solve it by changing your configuration:

Calculation Settings-> Apply Discount on Prices

Change Including Tax to Excluding Tax

  • Yes this worked. Now coupon percentage is applying correctly. I remember changing this setting a while back because for fixed price discounts in the checkout totals section the customer would see £4.166 in place of a £5 discount. Thanks for your help. Feb 23, 2015 at 22:51
  • Happy to help! If this has solved your issue, please mark the answer as accepted so the site knows this question has been resolved. Cheers Feb 23, 2015 at 23:53

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