Case Study :Modelling tax rules with Rulette

How to build a tax management system with Rulette: Part One

This is a deep dive into using Rulette for modelling business rules. It is a simplified (slightly) version of a real world use case that I have used Rulette for in production. We will try to model the tax that must be paid when certain types of items are sold by manufacturers located in different states.

In the beginning…

It starts with the forging of the great tax laws, where the government mandates that the tax that must be paid by a manufacturer on a sale depends on the state in which his facility is located (West bengal, Punjab…), the type of the item (T-shirt, shoes, bags etc), the material (silk, leather, gold…) and the price of the product. The product manager confers with the financial and legal team and puts together all combinations of these attributes in an excel sheet. The whole thing is a layered structure built on default rules with more specific rules applied on top of them (Karnataka charges 5% on shoe sales, unless they are made of leather and priced above Rs. 5000, in which case it charges 10%). Something like this.

We, the dev team, now need to build a system to store these rules and determine what should be the applicable taxes on a sale. There are a lot of rules, so the system should be able to handle that, but the expectation is that they will be changed infrequently but read very regularly. Of course, we would like to make the…