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In this guide, you’ll learn what tax regions are and how to manage them.

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What is a Tax Region?

A Tax Region represents a geographical area where you must apply specific tax rates. For example, if you operate in the United States and Canada, you might have different tax rates for each country, and even in different states or provinces within each country. In this case, you can create a tax region for each country you operate in and set up sublevel tax regions for each state or province within the country. Each tax region has its own tax rate, and you can override the default tax rate in a region for specific products or product types.

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View Tax Regions

To view tax regions in your store, go to Settings → Tax Regions. Here, you can see a list of all the tax regions you have set up in your store. You can also search, filter, and sort the tax regions to find the one you are looking for. Tax regions list

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Create Tax Region

To create a tax region:
  1. Go to Settings → Tax Regions.
  2. Click the Create button at the top right.
  3. In the form that opens:
    • In the Country field, select the country that this tax region applies to.
    • Under the “Default tax rate” section, you can optionally enter a name, tax rate, and tax code in their respective fields.
  4. Once you’re done, click the Save button.
Create tax region form

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View Tax Region Details

To view the details of a tax region:
  1. Go to Settings → Tax Regions.
  2. Click on a tax region from the list.
This opens the tax region’s details page, where you can also manage the tax region. Tax region details

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Edit Tax Region

To edit a tax region:
  1. Go to the tax region’s details page.
  2. Click the icon at the right of the tax region’s name.
  3. Choose Edit from the dropdown.
  4. In the side window that opens, you can edit the tax region’s default tax provider.
  5. Once you’re done, click the Save button.
Edit tax region form

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Edit Default Tax Rate

To edit the default tax rate of a region:
  1. Go to the tax region’s details page.
  2. In the first section, you’ll find details of the default tax rate, including its tax rate and code. Click the icon at its right.
The icon to click on
  1. Choose Edit from the dropdown.
  2. In the side window that opens, you can edit the tax rate’s name, code, and rate to charge.
  3. Once you’re done, click the Save button.
Edit default tax rate form

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Manage Tax Rate Overrides

You can override the default tax rate of a region for specific products, product types, or shipping options. This is useful if you have different tax rates for certain products or shipping options in a region. You can override tax rates for tax regions and sublevel tax regions.

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Create Tax Rate Override

To create a tax rate override for a product or product type in a tax region:
  1. Go to the region’s details page.
  2. In the “Overrides” section, click the Create button.
  3. In the form that opens:
    • Enter the tax override’s name, rate, and code in their respective fields.
    • If the override should be combined with the default tax rate, enable the “Combinable” toggle.
    • Under the “Targets” section, you can select the target of this override. You can add a target by clicking “Add target”. For each target:
      • Choose the target type (Product, Product Type, or Shipping Option).
      • Choose the product, product type, or shipping option that the override applies to, based on the target type you chose.
  4. Once you’re done, click the Save button.
Create tax rate override form

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Edit Tax Rate Override

To edit a tax rate override:
  1. Go to the region’s details page.
  2. In the “Overrides” section, click the icon at the right of the override you want to edit.
  3. Choose Edit from the dropdown.
  4. In the side window that opens, you can edit the override’s name, rate, code, and whether the tax rate should be combined with the default rate. You can also edit the targets of the override.
  5. Once you’re done, click the Save button.
Edit tax rate override form

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Delete Tax Rate Override

Deleting a tax rate override is irreversible.
To delete a tax rate override:
  1. Go to the region’s details page.
  2. In the “Overrides” section, click the icon at the right of the override you want to delete.
  3. Choose Delete from the dropdown.
  4. Confirm deleting the override by clicking the Delete button in the pop-up.

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Sublevel Tax Regions

Tax regions for some countries, like the United States, have a States, Province, or Cantons section in the tax region details page. Here, you can add sublevel regions for the country. Sublevel regions section You can also enable it for other countries that don’t show this section by default. For those countries, you’ll find a note at the top of the page where you can enable sublevel regions. Enable sublevel regions alert After enabling this setting, you’ll find a “Sublevels” section in the tax region details page where you can add sublevel regions.

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Create Sublevel Tax Region

To create a sublevel tax region in a tax region:
  1. Go to the tax region’s details page.
  2. In the “Sublevels” section or its equivalent (such as States, Province, or Cantons), click the “Create” button.
  3. In the form that opens:
    • If the country supports a sublevel by default, you’ll find an input to select a state, province, or canton.
    • If the country doesn’t support a sublevel by default, you’ll find an input to enter the lower-case ISO 3166-2 code of the sublevel.
    • Under the “Default tax rate” section, you can optionally enter a name, tax rate, and tax code in their respective fields.
    • If the sublevel tax region’s rates should be combined with the parent’s rates, enable the “Combinable” toggle.
  4. Once you’re done, click the Save button.
Create sublevel region form

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View Sublevel Tax Region Details

To view the details of a sublevel tax region:
  1. Go to the tax region’s details page.
  2. Under the “Sublevels” section or its equivalent, click on a sublevel tax region.
This opens the sublevel tax region’s details page, where you can also manage the sublevel tax region. Sublevel tax region details page

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Manage Sublevel Tax Region’s Rates

You can manage the sublevel tax region’s default and override rates the same way you manage the parent tax region’s rates.

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Delete Sublevel Tax Region

Deleting a sublevel tax region is irreversible.
To delete a sublevel tax region:
  1. Go to the sublevel tax region’s details page.
  2. Click the icon at the right of the sublevel tax region’s name.
  3. Choose Delete from the dropdown.
  4. Confirm deleting the sublevel tax region by clicking the Delete button in the pop-up.

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Delete Tax Region

Deleting a tax region is irreversible.
To delete a tax region:
  1. Go to the tax region’s details page.
  2. Click the icon at the right of the tax region’s name.
  3. Choose Delete from the dropdown.
  4. Confirm deleting the tax region by clicking the Delete button in the pop-up.