{"title":"Configure tax","slug":"configure-tax","url":"https://support.storeconnect.com/articles/configure-tax","url_markdown":"https://support.storeconnect.com/articles/configure-tax.md","subtitle":null,"summary":"Configure tax for your store by setting the tax method on price books, creating geographic zones, defining tax rates with effective dates, and associating products with those rates.","type":"Help_Documentation","video_url":"","keywords":"tax configuration, custom tax rates, tax method, tax inclusive, tax exclusive, price book, tax zone, tax rates, geographic zones, effective dates, product tax, checkout tax, configure tax, GST, VAT, tax setup, tax region, tax exempt","last_modified":"2026-09-15T02:32:04+0000","body_markdown":"Custom tax rates let you define your own tax rates per geographic region and apply them to specific products. This approach suits stores with a manageable set of tax rates — for example, a single national rate like Australian GST. If your requirements are more complex (many jurisdictions, frequently changing rates), consider using [Avalara AvaTax](avatax) instead.\n\n## Prerequisites\n\n- At least one Price Book configured in your store\n- At least one Zone configured, or be ready to create one (see [Configure zones for tax and shipping areas](zones))\n\n## Step 1: Set the tax method on your price book\n\nTax-inclusive or tax-exclusive pricing is controlled at the Price Book level, not at the store level. Each Price Book has a Tax Method setting that determines how prices are displayed to customers.\n\n1. Go to **StoreConnect Navigation** \u003e **Configuration** \u003e **Price Books**.\n2. Open the Price Book you want to configure.\n3. Set the **Tax Method** field:\n   - **Exclusive** (default) — prices are displayed without tax; tax is calculated and shown as a separate line item at checkout.\n   - **Inclusive** — prices already include tax; the tax component is shown separately at checkout for transparency.\n   - **Exempt** — no tax is applied to products in this price book.\n4. If Tax Method is set to **Inclusive**, also set the **Tax Zone** field. This tells StoreConnect which zone's tax rates determine the tax portion embedded in the price.\n5. Select **Save**.\n\n### Override tax method per product\n\nYou can override the Price Book setting for individual products using the Price Book Entry.\n\n1. Open the product record and navigate to its **Price Book Entry**.\n2. Set the **Tax Method** field:\n   - **Inherit** (default) — the product uses the parent Price Book's tax method.\n   - **Inclusive**, **Exclusive**, or **Exempt** — overrides the Price Book setting for this product only.\n3. Select **Save**.\n\n## Step 2: Create a zone\n\nZones define the geographic areas where a tax rate applies. Each tax rate must be linked to a zone.\n\n1. Go to **StoreConnect Navigation** \u003e **Configuration** \u003e **Locations** \u003e **Zones**.\n2. Select **New**.\n3. Enter a **Name** for the zone (e.g., \"Australia\" or \"California\").\n4. Select **Save**.\n5. On the zone record, go to the **Related** tab and add the geographic members that define this zone:\n   - **Zone Countries** — add countries by selecting a **Country** record, which is identified by its ISO 3166 alpha-3 code.\n   - **Zone States** — restrict to specific states within a country.\n   - **Zone Postcodes** — restrict to specific postcodes or ZIP codes.\n   - **Zone Cities** — restrict to specific cities.\n\nA customer's address matches the zone if it matches any one of the zone's defined members (country, state, postcode, or city).\n\n:::note\nTax zones match a customer's address by its two-letter ISO 3166 alpha-2 country code, such as `AU`. The three-letter code `AUS` and the full name `Australia` match no zone, so no tax is calculated. This is a different field from the **Country** record on the zone, which holds the three-letter code.\n\nThe standard checkout (web and point of sale) stores the correct code automatically, so no action is needed for normal orders. If customer addresses are created another way, through a data import, the API, or a custom automation, make sure the country is stored as the two-letter code.\n\nThis requirement applies to custom tax rates. Avalara accepts full country names, and so does the Salesforce **Calculate Tax** action, which means a recalculation can report tax on an address that a live checkout or a subscription renewal will not tax.\n:::\n\nFor a detailed walkthrough of zone setup, see [Configure zones for tax and shipping areas](zones).\n\n## Step 3: Create a tax rate\n\n1. Go to **StoreConnect Navigation** \u003e **Configuration** \u003e **Taxes** \u003e **Tax Rates**.\n2. Select **New**.\n3. Fill in the following fields:\n\n   | Field | Description |\n   |-------|-------------|\n   | **Name** | Internal identifier for this rate (e.g., \"GST Australia\"). |\n   | **Display Name** | Shown to customers at checkout and on receipts (e.g., \"GST\" or \"Sales Tax\"). |\n   | **Tax Rate** | The percentage rate (e.g., enter `10` for 10%). |\n   | **Zone** | The zone this rate applies to. |\n   | **Based on Shipping Address** | Checked (default): tax is determined by the customer's shipping address. Uncheck to use billing address instead. |\n   | **Effective From** | The date this rate becomes active. Set to today or a past date to activate immediately. |\n   | **Effective To** | Optional. Use this to schedule a rate expiry or future rate change. Leave blank for an ongoing rate. |\n\n4. Select **Save**.\n\nRepeat this process for each tax rate you need.\n\n## Step 4: Apply tax to products\n\nThe Price Book Tax Method controls how product prices are displayed (with or without tax), but it does not determine which tax rates are calculated. Each product needs to be linked to the tax rates that apply to it. StoreConnect uses these links to calculate the correct tax amount at checkout based on the customer's address.\n\nThere are two approaches for linking products to tax rates. Both are equally valid — choose based on the size and complexity of your catalog.\n\n### Option A: Direct product association\n\nBest for small catalogs or a single tax rate applied to most products. You work from the Tax Rate record outward, adding products to it rather than visiting each product individually.\n\n1. Open the **Tax Rate** record.\n2. Go to the **Related** tab.\n3. Under **Product Taxes**, select **New**.\n4. Select the product to apply this rate to.\n5. Select **Save**, or **Save \u0026 New** to continue adding more products.\n\nTo apply the tax rate to shipping costs, add the **StoreConnect Shipping Product** to the list.\n\nFor large catalogs, these associations can be created in bulk using a data import tool such as [Dataloader.io](https://dataloader.io).\n\n### Option B: Tax groups\n\nBest for larger catalogs or when multiple tax rates apply to the same set of products. You define the tax rates once in a group, then link the group to each product. When tax rates change, you update the group — not every product.\n\n1. Go to **StoreConnect Navigation** \u003e **Configuration** \u003e **Taxes** \u003e **Tax Groups**.\n2. Select **New** and give the group a name (e.g., \"Standard Tax\").\n3. In the Tax Group record, go to the **Related** tab.\n4. Under **Tax Tax Groups**, select **New** and link each of your tax rates to this group.\n5. For each product, create a **Product Tax Group** record pointing to the Tax Group.\n\nAs with Option A, the Product Tax Group records can be created in bulk via data import for large catalogs.\n\n:::tip\nTax groups are particularly useful for the USA, where many ZIP codes each have their own rate. See [Set up zones for applying US tax rates](manual-tax-configuration-for-usa) for a full walkthrough.\n:::\n\n## Verification\n\nTest your configuration on your store before going live:\n\n1. Add a taxable product to the cart.\n2. Proceed to checkout and enter a shipping address within a taxable zone.\n3. Confirm tax appears correctly in the order summary.\n\n**Example — Exclusive pricing:** A $100 product with 10% GST displays as $100 + $10 tax = $110 total.\n\n**Example — Inclusive pricing:** A $110 product with 10% GST displays as $110 (includes $10 GST).\n\nIf tax does not appear, check:\n\n- The customer's address falls within the zone defined on the tax rate.\n- The tax rate's **Effective From** date is today or earlier.\n- The product has a Product Tax or Product Tax Group record linking it to the rate.\n- The Price Book's **Tax Method** is set to **Exclusive** or **Inclusive** (not **Exempt**).\n- The country on the customer's address is the two-letter ISO country code (such as `AU`), not the three-letter code `AUS` and not a full country name like `Australia`. This only matters for addresses created by import, API, or custom automation; the standard checkout handles it automatically.\n\n## Next steps\n\n- [Configure zones for tax and shipping areas](zones)\n- [Set up zones for applying US tax rates](manual-tax-configuration-for-usa)\n- [Avalara AvaTax](avatax) — automated tax for complex multi-jurisdiction requirements\n- [Recalculating taxes](recalculating-taxes) — adjust tax on existing orders after changes\n- [Configure tax exempt customers](tax-exempt-customers)"}