# Creating an Example Tax Rate in WooCommerce

> **Source video:** https://www.youtube.com/watch?v=HC2IUnJSJro

This guide walks you through creating your first standard tax rate in WooCommerce. You'll learn what each field in the tax rate row does, and work through a complete Indiana sales tax example.

## Setting Up a Standard Tax Rate

With your tax settings done, go to **WooCommerce → Settings → Tax**, then open **Standard rates**.

If you enabled taxes in the quick setup wizard, you should already have at least one tax row here. To create your own, select **Insert row**.

## Understanding Each Field

- **Country code** — A two-digit code, for example `US`. You can leave this blank to apply the rate to all countries.
- **State code** — Again a two-digit code. In the US, use the two-digit abbreviation, for example `IN` for Indiana. Leave blank to apply to all states within the country.
- **Zip / Post codes** — Enter zip or post codes for this rate. Separate multiple codes with a semicolon. You can also use wildcards to match several post codes automatically (for example `PE*` matches all post codes starting with `PE`), or numeric ranges such as `2000-3000`. Leave blank to apply to all zip or post codes.
- **City** — Use a semicolon to separate a list of cities. Leave blank to apply to all cities.
- **Rate %** — The most important field. Enter your required or desired tax rate. For example, in Indiana enter `7.000` for the state's 7% sales tax.
- **Tax name** — Give your tax rate a name, for example *Sales tax*.
- **Priority** — Choose a priority for this tax rate. Only one matching rate per priority will be used. To define multiple tax rates for a single area, you need to specify a different priority for each rate.
- **Compound** — Check to apply this tax on top of all prior taxes. Check or uncheck accordingly.
- **Shipping** — Check the shipping box if this rate also applies to shipping.

## The Example: Indiana Sales Tax

Here is what the example setup looks like:

- Country code set to `US` for the United States
- `IN` for the Indiana state code
- Zip code and city fields left blank to cover every location in Indiana
- Sales tax rate is 7%, so enter `7.000`
- Name it *Sales tax*
- Priority set to `1`
- Not compounded on top of other prior taxes
- Applied to shipping (shipping box checked)

> **Note:** You can set additional standard rates by selecting **Insert row** again and adding more rates as needed. If you add multiple rates, WooCommerce orders them by specificity — it applies your most specific rate first, then moves to broader rates (for example from specific, to state, to country rates). You can also select other tax classes to add rates to those.

When finished, save your tax rate by selecting **Save Changes**.