tax on shipping charged twice - please help

[timlogotim]

When we ship to Tennessee, we must charge tax on our orders...including tax on the shipping amount.  So I have a tax rule set up in virtuemart that says if the bill to state is TN, charge 9.25% tax.  This "per bill" tax rule is set for -default- and -anonymous- shopper groups.  The math operation is set to +%. 

Because I have to charge sales tax on any "shipping" charges collected (only when shipping to TN), I have the shipment methods set to follow "-default- tax rules".  The problem that is happening is that the "tax" amount for shipping is being added to  the bill twice. 

An example case:
pre-tax product total is 13.43
tax for the product alone should be 1.24
the pre-tax shipping total (should be) 16.92
tax for the shipping alone should be 1.57
total for the order, should add those four numbers to result in 33.16

What is happening however, is the following:
pre-tax product total is 13.43 (as it should be)
the pre-tax shipping total is shown as 18.49 (it is adding in the tax to the actual shipping price...and then adding the tax amount again on top of that)
there is also a line that shows tax on the shipping alone should be 1.57
total for the order is presented as 34.73 (by adding product total 13.43, tax of 2.81 (which is tax for both the shipping and the products), and shipping charge of 18.49 (which is the shipping charge plus the shipping tax).

What setting is causing the shipping to get taxed double?  Can you point me in the right direction please?

Thanks!
Tim

[GJC Web Design]

as I understand it  - 'Tax per bill" is the whole bill taxed (incl. shipping)

as TN is the only one with tax what happens if you set shipping to no tax?

the ind. figures may not look correct but the total may be

[timlogotim]

That is a great question and thanks for helping out.  What happens when I apply no tax rule to the shipping method is that no tax is charged for the shipping fees at all.  Tax is only accounted for the product itself, not the shipping fees.  This is when tax per bill.  Do you have any other ideas?

[GJC Web Design]

have u tested with the std weight-countries shipping plugin and different tax settings of it?

[reinhold]

I have tested it with the default VM shipping plugin and a "Tax per bill" rule and was able to reproduce the issues.

IMO, that's a bug in VM: Either for "Tax per bill" the shipping charge should NOT include taxes (because they are "later" added per bill), or the per-bill tax should not include the tax on shipping, because in the price table the tax per bill is listed above the shipping and any accountant would expect that this tax then only applies to the items listed above (not the shipping listed below). Either way, including tax in both is not correct IMO.

I should mention that it works fine if you change the tax rule to "Vat tax per product".

Reinhold