Are taxes re-calculated for Credit Memos in Magento?
No. When an order is first created in Magento, the tax associated with each line item is saved in the database.
- When a credit memo is created, Magento does not recalculate sales tax but instead refunds the sales tax associated with each line item you select to refund.
TaxJar will typically step in every time Magento calculates sales tax, but since Magento does not perform any sales tax calculations on the credit memo page, TaxJar does not have an opportunity to calculate sales tax.
- By default, Magento will not calculate sales tax on an "Adjustment Refund" amount as mentioned here.