Create and set Different Tax Rates and set Tax Rules

In Magento 2 you will be able to create and set different Tax Rates for certain locations and/or product types.

Managing your Magento 2 Tax Rates, includes:

  • Step 1: Add Tax Rate
  • Step 2: Add Tax Rule

STEP 1: Add Tax Rate
To create a new Tax Rate, login to your website’s admin area and navigate to the Stores>Tax Zones and Rates section from the main admin panel. magento11.png

Click on the Add New Tax Rate button.

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Now you will be able to configure the tax rate:

  • Tax Identifier – The name of the tax used for internal identification
  • Zip/Post is Range – If selected you will be able to set up a Range of Post codes in the two fields below this one
  • State – The State on which you wish to impose the Tax Rate (If your country does not have States, this option will be grayed out)
  • Country – The Country on which you wish to impose the Tax Rate
  • Rate Percent – The Tax Rate percentage the customer will need to pay

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When you are done, click on the Save Rate button to save the Tax Rate.

STEP 2: Add Tax Rule

Once you have configured a Tax Rate you will want to implement it in a Tax Rule. To accomplish that, you will need to navigate to Stores>Tax Rulesfrom your admin dashboard.

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In the Tax Rule Information part of the configuration, you will need to put a Name for the Tax Rule and select the Tax Rate for it.

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If you expand the Additional Settings you will see a few more options to configure:

  • Customer Tax Class – Customer Tax Classes are used in certain cases when the purchase is not retail (wholesale for example)
  • Product Tax Class – Different types of products have different Tax Classes (food and electronics for example). To better manage your products, you can create a new Tax Class here that corresponds to the product’s type
  • Priority – The priority of this class when calculating from multiple tax rules (If two classes have the same priority they will be added during tax calculation)
  • Sort Order – Modifying this will change the display order of the tax if more than one tax can be selected (lower is higher with 0 being displayed on top)

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For additional settings regarding the Taxes calculation of your Magento 2 Store you will need to visit the Stores>Configuration section of your admin dashboard and then access Sales>Tax.