Tax Codes include information about tax rates and taxes that apply to transactions, Tax codes must be set up with Tax agency, Tax type, Tax control accounts.
1.Go to Setup > Accounting > Tax codes > New
2.Enter name for that tax code.
3.Give tax rate(percentage) in rate field.
4.Select Tax agency, and applicable Tax type.
5.Select applicable subsidiaries.
6.You can define tax codes for a particular period based on effective dates.