How does Tax work on Digital Items if customer enters a different billing address than storeLocation

[aih_kimg]

Hi,

I have enabled Shopify Markets with 2 markets (example Japan and Canada). Japan is the main market.

How does Tax work on Digital Items if customer enters a different billing address than the store location? Please see sample screenshot:

The digital item (so there's no need to input delivery address) I bought is from Japan site, but my billing country is different country (example Canada or let's any in another Asian country).

How is the tax here?  Do Canadians or Asians customer pay consumption tax in Japanese Yen?

If I got any idea wrong, please do correct me. Thank you.

[Omegatheme]

• If Your Store Is Set Up in Japan: By default, Shopify will apply Japanese consumption tax (JCT) to all sales, regardless of the customer's billing country, unless you set up tax overrides or exemptions

• Digital Goods and International Customers: For digital products, Japanese tax law generally requires you to charge JCT to customers in Japan, but not to overseas customers. However, Shopify's default settings may still apply JCT unless you configure tax rules to exempt non-Japanese customers

• In your screenshot, the Canadian customer is being charged Japanese consumption tax, and the total is shown in Japanese Yen45. This suggests your store is not currently set up to exempt foreign customers from JCT.

• If You Want to Exempt Foreign Customers from Japanese Tax: You need to set up a tax override or exemption in Shopify so that only Japanese customers (billing address in Japan) are charged JCT. Otherwise, all customers, regardless of their country, will be charged Japanese tax by default

• Currency Display: The checkout will display the total (including tax) in the store’s default currency (Japanese Yen), unless you have set up multi-currency support