From the Configuration Menu, click Edit Countries 

On this page, store administrators can set up tax rates based on the country with which the customer registers. Taxes can also be based on the state or the zip code customers specify.

If multiple levels of taxes are set up (e.g. state and zip code), customers are charged the cumulative amount.

 

To change the tax rates for a country, click the Country name, enter the desired values for each field, and click Save to save the changes.
  
  

Adding a Country

The store comes preloaded with a list of the countries that do the most online business, but does not contain every country. More countries can be added, by clicking the Create button.

The list of countries on this page is what is used to generate the Country drop-down lists customers see when creating addresses on the front end. If you want to enable customers to choose a new country, add the country on this page as shown below. If you want to remove countries from your site's drop-down lists, delete them from this page.

   

 

Field Name	Description
Country	This is the full name of the new addition. This will appear in full to customers in the dropdown menu during address creation
2 Letter ISO Code	The standardized 2-digit code for the new country. See here for a partial list.
3 Letter ISO Code	The standardized 2-digit code for the new country. See here for a partial list.
Numeric ISO Code	The standardized numeric code for the new country. See here for a partial list.
Postal Code Required	If this is checked, customers will have to enter a postal code when registering an address in this country.
Postal Code Regex	Regular expression used to validate customer-entered postal codes for addresses in this country.
Postal Code Example	Plain text example that will be shown to customers to ensure they enter the postal code for addresses in this country in the proper format.
Display Order	The order in which the country appears in the dropdown menu. If this is left to 1 for all countries, they will be listed alphabetically.