Taxes represent extra charges on top of the base price of a product. There are various forms of taxes that might be applicable, depending on local laws and the laws of the regions that your business serves. Common forms of applicable taxes are:
- Value added tax (VAT)
- Goods and services tax (GST)
- Sales taxes (as in the USA)
In Vendure every product variant is assigned a tax category. In many countries, different rates of tax apply depending on the type of product being sold.
For example, in the UK there are three rates of VAT:
- Standard rate (20%)
- Reduced rate (5%)
- Zero rate (0%)
Most types of product would fall into the “standard rate” category, but for instance books are classified as “zero rate”.
Tax rates set the rate of tax for a given tax category destined for a particular zone. They are used by default in Vendure when calculating all taxes.
Please note that tax compliance is a complex topic that varies significantly between countries. Vendure does not (and cannot) offer a complete out-of-the box tax solution which is guaranteed to be compliant for your use-case. What we strive to do is to provide a very flexible set of tools that your developers can use to tailor tax calculations exactly to your needs. These are covered in the Developer’s guide to taxes.