Pay tax based on the zip code you are from?

[CindyM22]

I think i've found my answer!

Zen Cart uses SHIPPING ADDRESS to determine appropriate taxes, i.e. which TAX ZONE you are shipping into. NOTE: this is the shipping address, and *NOT* the billing address.

[Ajeh]

Actually you have a choice on Shipping, Billing or Store address for:

Basis of Product Tax
On what basis is Product Tax calculated. Options are
Shipping - Based on customers Shipping Address
Billing Based on customers Billing address
Store - Based on Store address if Billing/Shipping Zone equals Store zone

Shipping
Billing
Store

Basis of Shipping Tax
On what basis is Shipping Tax calculated. Options are
Shipping - Based on customers Shipping Address
Billing Based on customers Billing address
Store - Based on Store address if Billing/Shipping Zone equals Store zone - Can be overriden by correctly written Shipping Module

Shipping
Billing
Store

Not all locations use the same rules so you can configure this in the Configuration ... My Store ... settings to match your rules ...