Create a Multi-rate Sales Tax

To create a multi-rate sales tax for two or more tax authorities (for example a state and a city sales tax)

1. Open the Manager > Taxes window
2. Click the '+' button in the left-hand Groups pane
3. Add the Group Tax name (perhaps something such as store tax)
4. With that name highlighted, click the '+' button in the right-hand pane
5. Add a Tax name and rate for each tax authority (for example, one for state, one for city)
6. The rates will be added together when applied to sales and purchases
7. Place a check mark in the box indicating this rate should be applied to new products when they are added (if appropriate)
8. Indicate how this Group should be used (Sales, Purchases, All)

Implement a Multi-rate Tax Group

In the Manager > Products > Pricing window, select the Tax Group that applies to the Product

You can use the above steps to create several tax groups that can be applied to various Products (different Tax Group of rates for different products).

On invoices, products will be taxed at the Tax Group rate, which will be the sum of all the rates associated with the Group. The Tax report will show the sales tax collected for each tax authority (each rate), while the invoice will show the total sales tax collected.