Creating a Tax Rule in magento

Finally, aGer creaNng the Customer Tax Classes, Product Tax Classes, and Tax Rates/Zones that we need, we are ready to create Tax Rules. For our demo store, we will need only one Tax Rule.

Retail customers who purchase non-food items within Pennsylvania (including Philadelphia) pay sales tax.

All other purchases are tax-free, so we don't need any Tax Rules to cover them.

1. Go to Sales | Tax | Manage Tax Rules.
The Manage Tax Rules page is displayed.

2. Click on Add New Tax Rule. The New Rule page is displayed.

NoNce that all of the Customer Tax Classes, Product Tax Classes, and Tax Rates/Zones that you created are displayed here. The Tax Rule will be a combinaNon of these three elements. You can choose one or more of each element.

3. Enter a Name for the Tax Rule.
In our demo store, we want the name to indicate the purpose of the Rule. So we will enter a name that tells us the type of customer, product, and rate/zone the Rule contains.

4. Select one or more Customer Tax Classes for the Rule.
In our demo store, we want this rule to apply only to Retail Customers.

5. Select one or more Product Tax Classes for the Rule.
In our demo store, we want this rule to apply only to Nonfood items.

6. Select one or more Tax Rates for the Rule.
In our demo store, we want this rule to apply to all zones in PA.

7. Click on Save Rule.

8. You are returned to the Manage Tax Rules page. You should see the Rule that you just added listed there, as seen in the following screenshot:

What just happened?
A Tax Rule is composed of a Customer Class, Product Class, Tax Rate, and the locaNon of the purchaser. You have just combined these elements into a Tax Rule. This Rule will apply to the unique combinaNon of customer/product/locaNon.

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