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For the EU region, the B2B customers can be identified and exempted from tax by validating their VAT number. The customer's VAT number can be collected during sign up from the checkout pages and Chargebee automatically validates their VAT number from the VIES server.
Below are the different scenarios and how taxes are applied to each of them:
1. Selling to customers( B2C):
Taxes are always applied(based on their country in billing/shipping address)
2. Selling to another business and does not provide a valid VAT number:
Taxes are always applied(based on their country in billing/shipping address)
3. Selling to another business & provides a valid VAT number from another EU country:
Taxes are NOT applied( VAT is 0%)
4. Selling to another business & provides a valid VAT number but is in the same country as you(the merchant):
Taxes are applied
Note:
Please note that B2B sales in the same country as your organization address are taxable.
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