Sales Tax Rates

Learn how to configure tax rates for order subtotal, discounted subtotal, AND shipping cost.

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Written by Seller Labs
Updated over a week ago

This article explains how to complete the configuration of sales tax rates when configuring sales tax.

NOTE: If you need to configure sales tax rates for shipping costs separately, please follow the instructions in the article Sales Tax Rates on Shipping Costs.

To set up general tax rates:

  1. On the Sales Tax page in your store Admin area, specify the type of costs that will be the basis of your tax rates calculation in the Taxable base selector.

    • X-Cart 5.4.x - Store Setup > Taxes > Sales Tax

    • X-Cart 5.5.x > Store > Taxes > Sales Tax

      The available options are as follows:

      • Subtotal + Shipping cost;

      • Discounted subtotal + Shipping cost;

      • Subtotal;

      • Discounted subtotal;

      • Individual settings for every rate.

    For example, suppose you select "Discounted subtotal + Shipping cost." In that case, your tax rate amounts will be calculated as percentages of the sum of the product subtotal after the application of discounts and the estimated product shipping cost.
    If you need multiple tax rates calculated based on different costs, select the last option - Individual settings for every rate. This option adds a selector with the first four options from the above list for each of your tax rates, allowing you to specify a taxable base for every tax rate individually.

  2. Click New Rate or Add New to configure tax rates depending on your software version.

    • X-Cart 5.4.x - General Tax Rates > New Rate

    • X-Cart 5.5.x - Tax Rates By Zones > Add New

    Depending on the Sales Tax add-on configuration, you may need to fill in the following fields:

    • Zone: Specify the address zone for the tax rate. The tax rate will be applied to the orders of the customers whose address belongs to the selected address zone. Whether it is their billing or shipping address depends on the option selected in the Address for sales tax calculation field in Common Tax Settings.

    • Tax class (optional): Specify the type of products (tax class) for the tax rate. If you select the Default tax class option, the tax rate will be applied to all products with the default tax class assigned.

    • User membership (optional): Specify the user membership level for the tax rate. The Ignore membership option allows you to create a tax rate that will be applied to all orders irrespective of the buyer's membership. The "User membership" column becomes available when you disable the "Use the same tax rates for all user membership levels" option in Common Tax Settings.

    • Taxable base (optional): Specify the type of costs your tax rate calculation should be based on. The "Taxable base" column becomes available for general tax rates when you select the Individual settings for every rate option in the "Taxable base" field in Common Tax Settings.

    • Rate: Specify the tax rate amount as a percentage of the selected taxable base.

    You can add as many rates as you need.

  3. Click Save changes to make the rates active.

After completing your tax rates setup, enable the tax for your store.

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