We are based in Canada. However, we charge taxes based on province that the order is being made in. We are based on Ontario but as an example, we would only charge a customer in Quebec 5%, PEI 15%, etc. This depends on your organisation and tax account setups, so get your accountant's opinion on what you should be collecting.
Without seeing it's difficult to know, but it 'sounds' like you have a country tax set up (5%) then you have your regions set up (Alberta, BC, etc) but you have the compound on top of federal tax selected. You want to make sure your dropdowns (added / instead / compound) are all set up right.