charge VAT to ALL customers in that country, but only to the other 

EU countries where no valid EU VAT number was supplied. 

Customers outside the EU are not charged tax. 

3. Set 

the 

euvatnumbercheck

 config setting to `y' (see 7.4.17.2). 

Note: this check is only a basic check on the length etc. according 

to EU VAT number formats for each country. There is no real time 

lookup of EU VAT numbers available to check the number exists or 

that it belongs to the company ordering. Furthermore, a number 

passing the check may still be invalid. You should always call your 

country's VAT authorities to check out any VAT numbers supplied 

and ensure that they belong to the company stated on the order. 

In most EU countries, it is customary to display prices inclusive of tax. If this 

is the case, set the 

pricesinctax

 config setting to `y' (see 7.4.17.3). This 

also means that the value you input for the price of a version will be 

considered as the tax inclusive price. So for example, if you enter the price of 

an item as  10, this means  10 inclusive of whatever tax that version has. If 

the item has 17.5% tax, then the  10 means  8.51 (price) +  1.49 VAT. 

However, if the item has no tax (0%) then  10 means  10 (price) and no 

VAT. In this way, nice looking final prices are easily entered. 

If you have tax inclusive pricing on, order pricing is totalled by calculating the 

price and tax per item and then multiplying these by the quantity of items to 

give row totals for items value and tax. The row values are then summed to 

give the totals (before shipping, discounts, etc.). This method of calculating 

tax is how a high street store in the EU would handle tax calculations   on a 

per item basis. 

If you have tax inclusive pricing off, order pricing is totalled by calculating the 

price and tax per row (i.e. items are totalled and the tax calculated based on 

this). The row values are then summed to give the totals (before shipping, 

discounts, etc.). This method of calculating tax is how popular accounts 

packages in the UK handle tax when creating invoices. 

6.17.2 

US tax handling 

In the US, tax works on a per state basis rather than per country (as in the 

EU). To enable this, you need to pin down the state that a customer is in. 

The CactuShop destinations table contains records for each individual US state 

as well as the USA as a whole. CactuShop's outside of the USA will need just 

the 

USA

 record active and the individual US states can be disabled. 

If your store is located in the US, you need to do the following: 

1.  Disable the main 

USA

 destination record and activate the 

individual state records, e.g. 

USA   Alabama

. 

2.  Set the state where the store is located to charge tax, other 

states and countries should be set not to charge tax. 

3.  Set up your sales tax value as one of the tax rates and link all 

products for which this tax rate applies to that. 

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