Setting up taxes is a multistep process. If any of your goods/services are taxable, to setup your taxes you will need to configure:

1. Setup Product Tax Categories
2. Setup Tax Regions
3. Setup Tax Rules
4. Setup Tax Rates
5. Setup Tax Sets

Tax rules allow you to identify which product tax categories are taxable in which Tax Regions. These tax rules may have been automatically created when you created regions, but you may add additional tax rules on the Tax Rules tab.

1. Click Setup
2. Click Taxes in the Finance section.
3. Click the Tax Rules tab.

   

4. Click the Add button to create a new tax rule.

   

5. Select a Region Name from the drop down box. This is the region in which this rule will apply.
6. Select a Product Tax Category from the drop down box. This is the product category that will be taxable in the selected region.
7. Click Done.

The next step is to set up your tax rates.