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It seems like there are a few quirks in the tax calculator in the latest 1.4 releases. The value for Tax Calculation Method Based On should actually be set to "Total", otherwise the tax will be calculated incorrectly. Previously I had this value as "Unit price" in the post, which was based on earlier pre-releases of 1.4. Trying changing this setting and see if it works for you.
Chris Norton     Sunday 21 Feb.

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