Problem with tax calculation with international buyers

  • Resolved kraeMit

    (@kraemit)


    1 year, 5 months ago

    Hi,
    I’m running a WooCommerce shop based in EU/DE with latest versions WP 6.6.2 using WooCommerce 9.5.2. I’m selling international, shop is configured to show prices including tax, MaxMind Geolocation is configured.

    For EU customers this works all good : Price is shown correct on products page 49,90€ incl. VAT, 19% VAT is shown correct in the Basket – all good.

    BUT for international customers (checked using VPN to USA) I have the problem, that Products page shows 41,93€ __with VAT included__, means it is the 49,90€ original price minus 19% what is completely wrong (big wondering here). That is without giving any address data, but Geolocation shows correct USA.
    There is no extra VAT calculation on the cart’s page, which is o.k. as there is no VAT to pay.

    So from my point of view the shop does not understand that an international buyer from e.g. USA does not have to pay VAT AND the shop is subtracting the 19% from the original price, what is completely wrong.

    Looking for the related configurations I have to work on to fix this.

    Thank you for every single tip!

    Best regards
    kraeMit

    • This topic was modified 1 year, 5 months ago by kraeMit.
    • This topic was modified 1 year, 5 months ago by kraeMit.
Viewing 5 replies - 1 through 5 (of 5 total)
  • Jonayed (woo-hc)

    (@jonayedhosen)

    1 year, 5 months ago

    Hi @kraemit ,

    Thanks for reaching out!

    It seems your shop is configured for international sales with prices set to include tax and uses MaxMind Geolocation. For EU customers, everything works as expected: prices are displayed correctly, including VAT, and the cart shows accurate tax details.

    However, for international customers (e.g., in the USA), product prices on the product page are incorrectly displayed. Instead of showing the base price without VAT, the shop deducts 19% from the VAT-inclusive price, which is not correct. This issue occurs even though geolocation correctly detects the customer’s location as the USA. The cart page shows no VAT applied, which is expected, but the product page pricing remains incorrect.

    To help resolve this, could you please share a full screenshot of your tax settings? You can find these under WooCommerce > Tax—specifically, the Tax Options and Standard Rates sections. If you do not already have a screenshot tool installed, Snipboard.io can be used to easily share screenshots.

    Additionally, please confirm the following:

    • Is “Calculate tax based on” set to “Customer shipping address”?
    • Is “Display prices in the shop” set to “Including tax”?
    • Have you correctly set up international tax rates (e.g., zero tax rates for non-EU countries) in your tax settings?

    It would also help us to review your current System Status Report to gain more insight into your setup. You can find this report in your WooCommerce dashboard by going to WooCommerce > Status. From there, please select Get system report and then Copy for support.

    Once you’ve gathered this information, please paste it into a Code block in your reply or use pastebin.com and share the link with us.

    Let me know once you’ve checked this. I’m happy to assist further!

    Thread Starter kraeMit

    (@kraemit)

    1 year, 5 months ago

    Hi @jonayedhosen,

    thanks for your support!

    Tax – Tax options : https://snipboard.io/rDMmbX.jpg

    Tax – Standard Taxes : https://snipboard.io/qS4Aos.jpg

    • Is “Calculate tax based on” set to “Customer shipping address”?
      Yes.
    • Is “Display prices in the shop” set to “Including tax”?
      Yes.
    • Have you correctly set up international tax rates (e.g., zero tax rates for non-EU countries) in your tax settings?
      I have tried to do for CH, GB, UK as this are not members of EU => check https://snipboard.io/waHyYn.jpg
      But that still does not change the behavement in the shop deducts 19% from the VAT-inclusive price.
      I checked again because of your questions and I can see double entries there : ‘Steuerfreie rates’ and ‘Zero Rate Rates’ seems to be the same!? Don’t know how this can happen.
      And honestly during testing with various configurations using a VPN to USA and UK I found out that it is difficult because of caching. That’s the reason I’m asking for help to understand what is the generel correct approach to this use case).

    System Status Report has been saved : https://pastebin.com/uA03C6bh (1 week validity)

    Thanks!!
    Best Regards
    Marcus

    Thread Starter kraeMit

    (@kraemit)

    1 year, 5 months ago

    Additional informations : As I have 2 entries for the Zero Tax sections, I think it might be possible that they influence each other :

    The only reason I can imagine for this double entry can be the plugin ‘Germanized für WooCommerce’, which had been installed in the past but is not in use now.

    Thread Starter kraeMit

    (@kraemit)

    1 year, 5 months ago

    Addional informations 2: As for the double entries : I have another shop site (my new one) which acts in the same false way, using same configuration but has single tax ‘zero’ entry.

    • This reply was modified 1 year, 5 months ago by kraeMit.
    Plugin Support shahzeen(woo-hc)

    (@shahzeenfarooq)

    1 year, 5 months ago

    Hi there!

    I understand your concern, but the behavior you’re experiencing is actually how WooCommerce is designed to handle taxes when prices are set to include tax.

    Here’s why this happens:

    • When you enter a price of 49,90€ inclusive of tax, WooCommerce calculates the base price (41,93€ in your case) by removing the 19% VAT.
    • For customers in the EU, WooCommerce adds the 19% VAT back to the base price, so the product price remains 49,90€.
    • For customers in the USA (or any location with a 0% tax rate), WooCommerce doesn’t add any tax to the base price, so it displays 41,93€.

    This is the default behavior to ensure that prices displayed reflect the tax rules for the customer’s location. However, Please note suffix text(VAT included) remain the same for all users.

    If you want the same price (e.g., 49,90€) displayed regardless of location, you can consider one of these options:

    1. Set prices to exclude tax and let WooCommerce calculate and add taxes as needed.
    2. Use custom code or a plugin to override the price display for specific regions.

    Also, you can try to use the following code to show the same price for 0% VAT country. 

    add_filter( 'woocommerce_adjust_non_base_location_prices', '__return_false' );

    For more details you can use this article. https://github.com/woocommerce/woocommerce/wiki/How-Taxes-Work-in-WooCommerce#prices-including-tax—experimental-behavior

    However please note that we do not provide support for cusotmization, If you need more in-depth support or want to consider professional assistance for customization, I can recommend WooExperts and Codeable.io as options for getting professional help. Alternatively, you can also ask your development questions in the  WooCommerce Community Slack as custom code falls outside our usual scope of support.
    Use custom code or a plugin to override the price display for specific regions.

    Issue regarding two tax classes  ‘Steuerfreie rates’ and ‘Zero Rate Rates:

    Please make sure you have not added any custom classes in the Additional Tax Classes field. You can check this by going to WooCommerce → Settings → Tax → Tax Options, as shown in this screenshot: https://prnt.sc/pdLiRww8JkAe

    Thank you.

Viewing 5 replies - 1 through 5 (of 5 total)

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