diff --git a/erpnext/controllers/accounts_controller.py b/erpnext/controllers/accounts_controller.py
index 1d4fc994f90..493ddc76104 100644
--- a/erpnext/controllers/accounts_controller.py
+++ b/erpnext/controllers/accounts_controller.py
@@ -72,6 +72,7 @@ from erpnext.stock.get_item_details import (
 	NOT_APPLICABLE_TAX,
 	ItemDetailsCtx,
 	_get_item_tax_template,
+	_get_item_tax_template_from_item_group,
 	get_conversion_factor,
 	get_item_details,
 	get_item_tax_map,
@@ -3682,7 +3683,12 @@ def set_child_tax_template_and_map(item, child_item, parent_doc):
 		}
 	)
 
-	child_item.item_tax_template = _get_item_tax_template(ctx, item.taxes)
+	item_tax_template = _get_item_tax_template(ctx, item.taxes)
+
+	if not item_tax_template:
+		item_tax_template = _get_item_tax_template_from_item_group(ctx, item.item_group)
+
+	child_item.item_tax_template = item_tax_template
 	child_item.item_tax_rate = get_item_tax_map(
 		doc=parent_doc,
 		tax_template=child_item.item_tax_template,
diff --git a/erpnext/stock/get_item_details.py b/erpnext/stock/get_item_details.py
index b05559e6ca1..4fdc8af630b 100644
--- a/erpnext/stock/get_item_details.py
+++ b/erpnext/stock/get_item_details.py
@@ -733,11 +733,7 @@ def get_item_tax_template(ctx: ItemDetailsCtx, item: Document | None = None, out
 		item_tax_template = _get_item_tax_template(ctx, item.taxes, out)
 
 	if not item_tax_template:
-		item_group = item.item_group
-		while item_group and not item_tax_template:
-			item_group_doc = frappe.get_cached_doc("Item Group", item_group)
-			item_tax_template = _get_item_tax_template(ctx, item_group_doc.taxes, out)
-			item_group = item_group_doc.parent_item_group
+		item_tax_template = _get_item_tax_template_from_item_group(ctx, item.item_group, out)
 
 	if out and ctx.get("child_doctype") and item_tax_template:
 		out.update(get_fetch_values(ctx.get("child_doctype"), "item_tax_template", item_tax_template))
@@ -745,6 +741,18 @@ def get_item_tax_template(ctx: ItemDetailsCtx, item: Document | None = None, out
 	return item_tax_template
 
 
+def _get_item_tax_template_from_item_group(ctx, item_group, out=None):
+	from frappe.utils.nestedset import get_ancestors_of
+
+	ancestors = get_ancestors_of("Item Group", item_group)
+	for group in [item_group, *ancestors]:
+		group_doc = frappe.get_cached_doc("Item Group", group)
+		item_tax_template = _get_item_tax_template(ctx, group_doc.taxes, out)
+		if item_tax_template:
+			return item_tax_template
+	return None
+
+
 @erpnext.normalize_ctx_input(ItemDetailsCtx)
 def _get_item_tax_template(
 	ctx: ItemDetailsCtx, taxes, out: ItemDetails | None = None, for_validate=False