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    <p>My impementation was for retail point of sale, however it could be adapted to a zip based solution. As it was because of returns and the potential for returns to be from other tax districts the point of sale registers had to have the complete tax rule definitions.</p> <p>Our transaction supported unlimited number of taxing jurisdictions. Each tax jurisdiction provided a way to calculate tax based on a table concept just like income tax. The software would identify all of the jurisdictions that come into play and calculate the appropriate tax. </p> <p>For example NY has a luxury tax that comes into play on individual items priced over $110 each( it was regressive charging that rate on the first $109.99 ), and local counties have taxes so we were able to define:</p> <pre><code>Auth Start$ End$ Rate Base NY 0 109.99 0% $0.00 NY 110.00 - 4% $4.40 NYALB 0 - 4% $0.00 </code></pre> <p>So a sale of a $50.00 item in Albany resulted in a 4% tax of $2--the NYALB rate of 4% and the NY rate of 0% was in effect. A sale of $120.00 results in an effective 8% tax of $9.60--the NYALB rate of 4% and the NY rate of 4% on the amount at or over $110 + 4.40. </p> <p>Colorado has a single township that has PIF tax, which in addition to the state and county tax and is itself taxable.</p> <p>The state of Idaho rounds based on a .002 rule--if the calculated tax is 4.002 then the tax due is 4.01. Some jurisdictions round up always. For each jurisdiction we attach a rounding rule to further process the tax: Up, Down, .005 and .002.</p> <p>I have found organizing the tax data in this fasion is most flexible if you are interested in maintaining your own tax rules.</p> <p>But like several people already mentioned there are services that provide the tax data for you. You just have to figure out how to integrate it.</p> <p>EDIT: Tax Holidays... We had support for that too, just added a separate table that had start and end dates for a jurisdiction's holiday. The tax engine would just spit out zero during those dates.</p>
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