How can we ensure that discounts are reflected in the Taxable Sales Summary report in QuickBooks Online?

You're right that the Taxable Sales Summary report only displays taxable quantities for products and services, but not the effect of discounts. To work around this, you can set up a taxable discount item with a negative amount, and map it to Discounts Given account. From there, open the existing transactions, remove its original discount, add the new discount item instead, and save.

When you rerun the Taxable Sales Summary report, the discounts should appear.

Let us know in the comments if you have any other questions!