Configure Taxes

It's important to set the right tax rates for your customers when starting a store. You can configure the tax settings for each individual item in the product menu. You can choose to have taxes set up automatically or set up tax rates manually based on the destination or product.

Create New Tax Rates

To set up new tax rates:

1. Click eCommerce on the left side of the page, and then click Manage Store.
2. Select Settings, then click Taxes. You can do one of the following:
3. Toggle the Enable switch next to Automatic. See Automatic Tax Calculations for more information on using automatic tax rates.
4. To configure your tax rates based on destination or products sold, click Manage Tax Rates.
5. If you clicked on Manage Tax Rates and want to modify your own taxes, click on +Add New Tax.
6. Set up the following:
7. Tax Name. Type the tax name.
8. Tax Applies to. Choose Subtotal or Subtotal + Shipping. You can choose whether or not to Include tax in product prices.
9. Zone defines by. Choose either the Shipping Address or Billing Address. To manage zones, click Manage zones and set the zones to which your tax applies. See Shipping Options to find out more about shipping.
10. Tip: Taxes that are made based on the destination only show up at checkout, not on the product page.
11. Rates per zone. Type a tax rate for All destinations or click on Specify rates per zone.
12. Tap Save.

Notes:

• If you want to set up the same rate for several states, you can make a zone that includes these states and set the tax rate for that zone.
• The tax calculation algorithm looks at the configured list of tax rates from the top-down to decide which tax to use. When it finds a match, it stops and uses the tax rate for that zone. So you can set the tax rate for a specific state or states and then add a rate for "USA" at the end of the list. In this case, the USA rate will be used for all states except those that have been set up specifically.

There is also a pre-defined zone called "Other zones" that defines tax for areas that do not match any of the zones included in the rate list.

Configure Product Tax Rate

Here’s how to set an individual tax rate for a certain item:

1. Click Catalog in the Store Control Panel, then click Products.
2. Click Edit Product next to the product you want to add a tax to.
3. Select Tax and Shipping.
4. Choose Enabled next to the tax rate you want to use for the product. To avoid paying taxes on this item, disable all tax rates.
5. Click Save.