Configure taxes

How to apply a single global tax rate, and add per-location rates for states or countries

The Taxes tab under Store Configuration is where you set up sales tax, VAT, or GST on your store. From this screen you flip the tax system on or off, pick whether your listed prices already include tax (VAT-style) or whether tax is added at checkout (US-style), set a single global rate that covers everything, label the tax line the way your customers expect ("VAT" / "GST" / "Tax"), and optionally add per-location rates for states or countries that need different rates. A simple UK VAT setup is a 2-minute job; a US multi-state setup with per-state rates is about 10 minutes.

What is this for?

The Taxes panel is your tax-calculation configuration screen. Its job is to hold the rules that compute the tax line on every order. You reach for it on launch day to switch on taxes for your market, when you cross a threshold into a new state and need to register for sales tax there, when your VAT rate changes, and when your accountant asks you to label the tax line differently on invoices.

When you save on this screen, the new tax rules apply to every cart and every checkout on the next shopper's visit. Past orders keep the tax values that were calculated when they were placed — tax changes are not retroactive.

Good use cases

Example 1: Setting up US multi-state sales tax. You have nexus in California (8.25%) and New York (8.875%). Open Taxes, flip the Tax System master switch on, leave Prices Include Tax as No, set Tax Label to Tax, and set Global Tax Rate to 0.00 (so shoppers outside your nexus states pay no tax). Enable Location-Based Tax, click + Add new location, pick United States — California and enter 8.25. Click + Add new location again and pick United States — New York at 8.875. Save.

A California shopper buying the Tote Bag ($30) sees a subtotal of $30.00 and a Tax of $2.48 ($30 × 8.25%) at checkout, with a total of $32.48. A New York shopper on the same order sees Tax of $2.66. A shopper in Oregon (no nexus) sees Tax of $0.00.

Example 2: UK VAT-inclusive pricing. Your store lists UK prices that already include 20% VAT. Flip the master switch on, set Prices Include Tax to Yes, set Tax Label to VAT, set Global Tax Rate to 20.00. Leave Location-Based Tax off. Save.

A UK shopper buying the T-Shirt (listed at $29) sees $29.00 as the total at checkout. On the invoice, the price is split: $24.17 product + $4.83 VAT = $29.00. Your displayed price never changes — only the invoice breakdown shows the VAT portion.

Example 3: AU GST at 10%. Australian store, GST at 10%, no per-state overrides. Flip the master switch on, set Prices Include Tax to Yes, Tax Label to GST, Global Tax Rate to 10.00. Save. Every order picks up a 10% GST line labeled "GST" — invoices show the GST-inclusive and GST-exclusive totals as your accountant needs.

Example 4: Applying tax to shipping for a strict-regulation market. Your jurisdiction taxes shipping fees as part of the sale. Turn Apply tax to shipping to Yes. A California shopper whose cart is the Tote Bag ($30) + $5 shipping now pays tax on the full $35 ($35 × 8.25% = $2.89 tax) rather than on the $30 subtotal alone.

Example 5: Removing an old state you no longer have nexus in. You dropped below the sales threshold in Texas and no longer owe sales tax there. Open the Taxes panel, find the Texas location row, click its × remove button, and save. Texas shoppers immediately stop being charged state-specific tax; they fall back to your Global Tax Rate (which is usually 0.00 for a US shop).

What NOT to use this for

• Do not use this panel to set up per-product tax classes (tax-exempt food, luxury-rate items). Every product takes the same global or location rate. If your business needs per-product tax categories, you need custom work beyond this panel.
• Do not use Location-Based Tax for complex cross-border VAT rules (EU OSS, reverse-charge, B2B VIES). This panel is simple country/state matching. For complex tax obligations, pair SGEN with a dedicated tax service.
• Do not change tax rates mid-customer-session and expect the new rate to apply to their existing cart. Tax changes apply on the next page load. If a shopper is already on checkout with an older rate displayed, they see the new rate on the next refresh.
• Do not assume Location-Based rates override the Global rate for every location. Rates override only for locations you explicitly add. A shopper in a country you did not add picks up the Global Tax Rate as the fallback.
• Do not treat the Tax Label as a rate change. The label is purely cosmetic — "VAT" and "Tax" compute the same amount; only the word next to the number changes.

How this connects to other features

• Your public cart and checkout — the tax line on every cart and checkout reads the rate from here. Inclusive pricing hides the tax inside product prices; exclusive adds a visible tax line.
• Order invoices and confirmation emails — the tax breakdown on every invoice uses the Tax Label you set here.
• Shipping — the Apply tax to shipping toggle here decides whether your Shipping panel's flat-rate, weight-based, or pickup fees are included in the taxed total.
• General store settings — the Default Ship-From Country and State from the General tab are used as a fallback tax location when the shopper has not entered their own address yet (for example during product-page price preview before checkout).
• Products and coupons — tax is calculated on the cart subtotal after discounts but before shipping (unless shipping tax is on). Every product and every coupon contributes to the taxable subtotal identically.

Before you start

• You are signed in to SGEN as an Administrator or Site Owner.
• You know your tax obligations for the markets you sell in (consult your accountant if you are not sure — SGEN cannot give tax advice).
• For Location-Based Tax: you have the list of countries or states and their rates ready.

Where to go

1. Open the left navigation in your SGEN admin.
2. Click Store Management → Configuration → Taxes (or open /sg-admin/ecommerce/configuration/taxes directly).
3. The Taxes panel loads with five cards: Tax System, Tax Pricing Mode, Global Tax Rate, Shipping Tax, Location-Based Tax.

Steps

1. Flip the Tax System master switch on

The Tax System card is the master switch. Flip it on to enable any tax at all. With it off, every order has $0 tax regardless of other settings.

2. Pick inclusive or exclusive pricing

The Prices Include Tax dropdown has two values: Yes (your product prices already include tax — used in VAT markets like UK, EU, AU/NZ GST), No (your product prices are pre-tax; tax is added at checkout — used in most US markets).

3. Set the Tax Label

The Tax Label field is a plain-text word or phrase. Common values: Tax, VAT, GST, Sales Tax. This label appears on the cart and checkout subtotal area, the order invoice, and the order confirmation email.

4. Set the Global Tax Rate

The Global Tax Rate field is a decimal percentage — type 8.25 for 8.25%, 20 for 20%, 0 for zero. This rate is the fallback for any shopper whose address does not match a Location-Based rule.

5. Decide whether to tax shipping

The Apply tax to shipping dropdown has two values. Pick Yes in jurisdictions where shipping is taxed; pick No where it is not. If you are unsure, ask your accountant.

6. Optionally enable Location-Based Tax

The Location-Based Tax card is an optional feature for stores with multiple tax rates. Flip its switch on to reveal the location repeater. Each location row has Country, State, and Rate fields. Click + Add new location to append another row. Click the × button on any row to remove it.

How matching works: when a shopper's shipping address matches a location row exactly (country + state), that rate is used. If no location matches, the Global Tax Rate is used.

Important: every save of the Taxes panel replaces all location rows. If you edit one row and delete another, your save reflects exactly the rows visible on screen at save time — nothing merges from a previous save. Be sure every location you want to keep is visible before clicking Save.

7. Save

Click Save Tax Settings. A green success message reads Ecommerce configuration has been successfully updated! at the top.

8. Verify at checkout

Open your store in a private browsing window, add the Tote Bag to your cart, go to checkout. Enter a test address in each of your tax locations and confirm the Tax Label appears with the expected amount. For addresses outside your Location-Based rules, the tax uses your Global Rate (or $0 if that is the global). If Apply tax to shipping is Yes, the tax total is computed against subtotal + shipping; if No, against subtotal only.

What success looks like

• The green Ecommerce configuration has been successfully updated! message appears after Save.
• Checkout shows a tax line with your label and the expected amount.
• Switching addresses at checkout updates the tax amount to reflect the destination's rate.
• Inclusive pricing shows the same displayed price as before but breaks out the VAT portion on the invoice.
• Exclusive pricing adds a visible "Tax: $X.XX" line beneath the subtotal.
• Removing a location row and saving causes shoppers in that location to fall back to the Global Rate on their next checkout.

What to do if it does not work

• No tax is applied on any order. Confirm the Tax System master switch is on and Global Tax Rate or a matching Location-Based rate is set. A Global Rate of 0.00 and no matching location means zero tax — that is expected.
• Tax is being applied at the global rate even for a shopper in one of my location rows. Confirm the shopper's address exactly matches the country AND state on the location row.
• I saved and one of my location rows vanished. Every save replaces all rows. If a row was missing from the screen at save time, it is gone from the stored rules. Re-add it and save.
• My label says "Tax" on the invoice even though I set it to "VAT." Hard-refresh the admin panel and reopen Taxes — confirm the Tax Label field shows VAT. Save again. Old invoices keep the label they had at time of order.
• Shipping fee is suddenly being taxed. Check Apply tax to shipping — if it is Yes, shipping is in the taxable total. Flip it to No if that is what you want and save.
• Inclusive pricing changed my listed prices. Inclusive pricing does not edit your saved product prices; it changes how the split is shown on the invoice.

Next step