The Taxes tab will allow you to configure simple tax rules for purchases.
If you do not wish to charge any tax on purchase, simply leave the Enable Taxes option unchecked.
Tax Rates: This section lets you add tax rates for specific countries and/or states/provinces in those countries.
Fallback Tax Rate: The default tax rate is the tax rate charged to customers located in your base country / state or province.
Base Country: This determines the country that is loaded by default on the checkout screen for customers that do not have an address stored in their account.
Base State / Province: This determines the state / province that is loaded by default on the checkout screen for customers that do not have an address stored in their account.
Prices Entered with Tax: if enabled, this means that the price entered on the product edit screens is the total amount the customer will pay after taxes. For example, if enabled and the price of a product is $20, the customer will pay 20$ at checkout. The exact amount charged in tax will be calculated automatically.
Display Tax Rate on Prices: when enabled, the amount the customer is expected to pay in tax will be displayed below purchase buttons.
Display During Checkout: This determines whether prices are shown with taxes or without taxes on checkout. If set to Including Tax, a $10 product with a 10% tax will be shown as $11.
If your store is located in the European Union and you need to collect VAT numbers and manage VAT reporting, consider using the plugins below.
EDD Invoices - This extension will provide customers with an option to generate and download an invoice that can contain both the store and customer VAT numbers.
VAT for Easy Digital Downloads - This extension adds complete VAT support to Easy Digital Downloads stores.
Additional options are also available in the Taxes section of our 3rd Party Extensions pages.