Tax Regions
In Medusa, taxes are always scoped to a region. Each region you operate in gets its own tax configuration — rates, exemptions, and provider. This means a Kenya store charges 16% VAT, while a global store might charge 0% or delegate calculation to a third-party tax service.
How taxes flow
- A customer adds items to cart
- Medusa identifies the region from the cart's currency/country
- The tax engine calculates tax using that region's rates
- Tax is shown at checkout and included in the order total
Viewing tax regions
Go to Settings → Taxes. Each region you have created appears as a card with its current rates.
Configuring a region's tax settings
Click a region to open its tax settings.
Tax provider
The tax provider determines how taxes are calculated:
| Provider | When to use |
|---|---|
| System default | Simple flat-rate tax. You define the rates manually. Best for stores with straightforward requirements. |
| Stripe Tax / external | Automatic jurisdiction-aware calculation. Useful for selling to multiple countries with varying rates. |
For most stores in Kenya or other single-country markets, the System default is all you need.
Inclusive vs exclusive pricing
| Mode | What it means |
|---|---|
| Tax inclusive | Product prices already include tax. KSh 1,000 product → customer pays KSh 1,000 and tax is extracted from that amount. |
| Tax exclusive | Tax is added on top. KSh 1,000 product + 16% VAT → customer pays KSh 1,160. |
Kenya's standard VAT is 16% tax-exclusive. Set your Kenya region to tax-exclusive and add a 16% standard rate. If you display prices including VAT on your storefront, add the word "VAT inclusive" or "incl. VAT" next to prices.
Automatic tax calculation
If this is off, taxes are not calculated at checkout — useful for B2B or wholesale stores where tax is handled on invoice. Leave it on for standard consumer stores.
Tax rates within a region
After configuring the region-level settings, you add specific rates. See Tax Rates for the full guide.
Multiple regions
If you sell to multiple regions (e.g. Kenya + UAE), create a separate region for each. Each can have completely different:
- Tax rates
- Tax provider
- Inclusive/exclusive mode
- Product-level overrides
Changes to one region's tax config never affect another region.