Tax auto-calculation includes tax-free fees/charges, producing an inaccurate tax amount

[melvin-bot]

Problem

In New Expensify, tax is auto-calculated as expense total × tax rate. When an expense total bundles in tax-free components (e.g. fees, surcharges, or other non-taxable charges), the auto-calculated tax is applied to the full amount and comes out too high. There is currently no way to tell the app that part of the expense is not taxable, so the tax figure is inaccurate for any expense that mixes taxable and tax-free amounts.

This is a recurring pain point for customers whose expenses regularly include additional charges on top of the taxable base (common with GST/VAT-style taxes).

Current behavior

• Tax = full expense amount × selected tax rate.
• The only remedy is to manually override the tax amount on each affected expense (Tax field on the confirmation page / expense detail).
• For customers with many such expenses, this manual correction is slow and error-prone, and it makes reconciliation harder for their accountants.

Expected / requested behavior

Provide a way to exclude tax-free portions from the taxable base so the auto-calculated tax is accurate — for example, the ability to mark a portion of an expense as non-taxable, or to split the taxable vs. tax-free amount, so tax is calculated only on the taxable portion.

Notes

• Related existing tax work: [$250] Clean-up some tax related bugs. #94003 (tax bug clean-up umbrella).
• Requested via an internal account review; no existing issue frames the problem as "tax calculated on a total that includes tax-free fees/charges," so this is filed as a new feature request.