For this setup, taxes will be calculated based on the customer's shipping address and rounded at subtotal instead of line by line. The tax calculation for tax exclusive prices option is exactly what you'd expect it to be:
tax_amount = price * ( tax_rate_% / 100 )
Ensure that you do not use the tax-inclusive option because your calculations will be wrong (and your accountant will be mad at you!)
With the above settings, products listed in the E-Commerce store will be displayed without tax and tax totals will be itemized. This means that a total will be included for the entire tax class. If one tax class exists i.e. HST, then one line will be displayed with the total tax for all ordered items.
The standard class can be configured manually or you can download and import the tax table below. The end result of our simple Canadian Tax setup example will look like the table above. Make sure you double check with your accountant, especially for any specific tax rules pertaining to what you are offering.