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Set up tax settings (US only)

So that users understand the exact price that they’ll have to pay for a product, you must submit the taxes that you collect. This article helps you understand how to correctly set up your tax settings. Learn more about how tax settings work and when to use them.

Before you begin (US only)

Keep in mind that you’ll set up tax rates for each United States state that you charge taxes for. Typically, these are the states that your business has nexus in. If your products target the United States, but you don’t charge taxes in the United States, still indicate that in your tax settings. 

You can choose from the following options to determine tax in each state. Consult your tax advisor to understand which options would work best for you.

  • Use the manual option to enter a flat rate if you charge all customers the same amount of tax regardless of where they're located. 
  • Use the destination-based option if you charge taxes based on where your customer (the buyer) is located. This option assumes that you have nexus everywhere in the state (in every city and county). So if the state is a home rule state where sub-state nexus matters, the destination-based option might not be accurate.
  • Use the tax attribute if you collect a non-standard tax rate for a product or a product is exempt from tax.

Instructions (US only)

Use account settings for standard tax rates

To set up taxes, you’ll set taxes for each state where you charge taxes:

  1. Sign in to your Merchant Center account.
  2. Click Tax in the page menu.
  3. If you’re setting up taxes for the first time, you’ll see 3 options:
    1. Don’t configure tax at the account level. Select this if you charge taxes in the United States, but set up tax only through the tax attribute.
    2. Configure no nexus for all states. Select this if you don’t charge taxes in the United States.
    3. Configure tax and set up nexus. Select this if you do charge taxes in the United States.

Tip

If you want to switch to one of these options in the future, click Change in the upper right to see these 3 options again.

  1. Click Continue.
  2. If you choose to configure tax and set up nexus:
    1. Click Add state, and select the states where you charge tax.
    2. Next set the tax rate for each state. So click a state, and then choose the Tax rate:
      • Destination-based to let Google estimate the rate for destination-based states.
      • Manual to enter a specific rate. You may want to consider this option  for origin-based states or if you want to enter a custom rate.
    3. If you charge tax on shipping, select Tax on shipping.
    4. Click Save once you’ve added taxes for the state.

Use an attribute for non-standard tax rates

If you have one product that has a different tax rate or that’s tax exempt, submit the tax attribute for that product. 
The value that you submit for the tax attribute will override any account tax settings for that product. 

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