Tax code & is not valid for vendor payables. Enter input tax code.

What causes this issue?

Tax code &V1& is not relevant for calculating taxes on vendor payables.

System Response

Error message. The system checks Table T007A to determine the tax
type. Tax code &V1& has tax type 'A', which is used for receivables
(output tax code).

How to fix this error?

Select a tax code that is used for Input tax. Tax type 'V'.

Error message extract from SAP system. Copyright SAP SE.