> ## Documentation Index
> Fetch the complete documentation index at: https://spreecommerce.org/docs/llms.txt
> Use this file to discover all available pages before exploring further.

# Taxes

> Learn where tax is set up in Spree Commerce: tax categories, tax rates and the reasons businesses give for buying without tax.

Everything that decides the tax on an order sits on one screen. Navigate to **Settings → Taxes**, under the **Selling** group.

The screen has three tabs:

* **Categories** - How your products are grouped for tax, such as Standard or Reduced rate. See [Tax Categories](https://spreecommerce.org/docs/user/settings/tax-categories.md).
* **Rates** - The percentages Spree's built-in tax calculation charges, per category and place. See [Tax Rates](https://spreecommerce.org/docs/user/settings/tax-rates.md).
* **Exemption reasons** - Why a business may buy without tax. See [Tax Exemption Reasons](#tax-exemption-reasons) below.

You only see the tabs your role lets you open.

## Which Service Works Out Your Tax

Each [market](https://spreecommerce.org/docs/user/settings/markets.md) chooses who works out its tax: Spree's built-in calculation, or a connected service such as Avalara. The **Tax calculation** box under the page title lists your markets by the service each one uses, for example **Avalara AvaTax in United States**. Click **Manage markets** to change it.

This matters for the **Rates** tab. Your tax rates only apply to markets on Spree's built-in calculation. A connected service works the tax out itself and never reads them. The **Rates** tab says so, and when some of your markets use a connected service it names them, so you know the rates you edit there do not apply in those markets.

## Tax Exemption Reasons

Why a business buys without tax, such as resale or a government purchase. Staff pick one when recording a company's [tax exemption certificate](https://spreecommerce.org/docs/user/customers/companies.md).

Each reason has a **Name**, which is your own wording, and a **Code**, which your tax service receives. Spree's built-in calculation only keeps the code for reference, so any short code works. If a market calculates tax through Avalara, the code decides the exemption: once a market uses Avalara, the form offers Avalara's codes, such as `G` for resale or `A` for federal government, and you name each reason however you like. Change the code of each reason you use to Avalara's.

A new store arrives with six:

* Agricultural
* Charitable organization
* Educational institution
* Government
* Manufacturing
* Resale

To add one, click **Add reason** and fill in:

* **Name** - What staff pick from the list on a certificate.
* **Code** - What your tax service receives. Saved in capital letters.
* **Available on new records** - On by default. Turn it off to stop offering the reason on new certificates.

> [!NOTE]
>
> You can change a reason's name or code at any time. Every certificate with that reason follows, while orders already placed keep the reason they were taxed with. A reason that certificates use cannot be deleted, but you can retire it by turning off **Available on new records**.

## Further Reading

* [Tax Categories](https://spreecommerce.org/docs/user/settings/tax-categories.md) - Grouping products by how they are taxed
* [Tax Rates](https://spreecommerce.org/docs/user/settings/tax-rates.md) - The percentages charged in each place
* [Markets](https://spreecommerce.org/docs/user/settings/markets.md) - Where each market's tax service is chosen
* [Companies](https://spreecommerce.org/docs/user/customers/companies.md) - Recording a business's tax exemption certificates
* [Integrations](https://spreecommerce.org/docs/user/settings/integrations.md) - Connecting a tax service such as Avalara


This documentation is built and hosted on [Mintlify](https://mintlify.com), a developer documentation platform.