Set up manual tax zones by region
Create Tax Zones to apply different manual tax rates by country or state. Zones live under Payments > Settings > Taxes > Manual Taxes, where you also create and manage your manual tax rates. The Taxes page is organized into separate areas for display settings (whether prices include tax), Automatic Taxes, and Manual Taxes.
Before you start
Attach rates you have already created: a zone holds your existing manual tax rates, and it does not create new ones. A zone with no tax rates charges customers in that region no taxes at all.
Create a tax zone
Group the countries and states you sell in into zones, and name each zone for the region or tax setup it represents, such as a Canada zone that contains the relevant Canadian regions.
Open Payments > Settings > Taxes > Manual Taxes.
Create a new Tax Zone and give it a recognizable name based on the region or tax setup it represents.
Select the countries and states that belong to the zone.
Associate the existing manual tax rates you want customers in that zone to be charged, then save.
A country or state can belong to only one Tax Zone at a time, so regions cannot overlap between zones.
Attach tax rates to a zone
Add up to 10 tax rates to a zone, and add or remove them as your tax configuration changes. From the zone, attach the manual tax rates it should apply, and review or update the rates configured for each zone at any time.
Deleting a tax rate from a zone only removes it from that zone; the primary rate stays available to attach elsewhere.
How zones apply at checkout
A tax rate applies at checkout only when it is attached to both the product and the customer's zone: the intersection of the two is what gets charged.
A customer in a region included in a zone is charged the rates attached to both the product and that zone.
A region that is not defined in any zone is charged all rates attached to the product, without filters.
A zone with no tax rates charges customers in that region no taxes.
If you define no zones, tax rates attached to products keep the same behavior as before, so your current setup is unaffected.
Tax zones and automatic taxes
Automatic taxes take priority whenever they are available for the country and product combination. The tax rates associated with a zone apply only when automatic taxes are off or unavailable for that combination, so you can keep automatic taxes on and use zones as the manual fallback for the regions you choose.
For how the two systems interact generally, see Add taxes.