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# Setting Taxes

## What are taxes?

Token taxes are just percentages of the transferred tokens on each buy or sell transaction, which get automatically swapped to ETH or BNB. They can be set individually for buy and sell transactions.

There are **2 types of taxes:** taxes that get collected for you, and taxes that get collected for the liquidity pool, which help the project grow, as it automatically increases the liquidity in the pool.

{% hint style="success" %}
Just like [settings limits](/docs/launching-a-new-token/setting-limits.md), taxes are a good way of dealing with bots and to get a constant passive revenue as long as your token gets traded and makes a lot of volume.
{% endhint %}

## How to set taxes?

To set taxes, simply click on one of the 4 corresponding buttons. You will be prompted to submit the percentage. After replying to the message, the menu will refresh and calculate the total tax for you. This is just the sum of your tax and the pool tax. Since both can be 25% each, the maximum possible total buy or sell tax is 50%.

<figure><img src="/files/u7BNdgQIulBLgV7aK9MM" alt=""><figcaption></figcaption></figure>

### 1. Your Tax

This tax will be deducted on any buy or sell and automatically swapped back to ETH or BNB, depending on which chain you launch on. It will then be sent automatically to your bot wallet that you used to deploy the token with.

{% hint style="info" %}
This tax needs to be 25% or less and [can be changed](/docs/token-management-and-update/updating-taxes-and-limits.md) after deployment. It can be set in steps of 0.1%
{% endhint %}

### 2. Pool Tax

The pool tax will be deducted on any buy or sell, from where half of those tokens will be swapped back to ETH or BNB and added to the liquidity pool with the other half.

{% hint style="info" %}
The pool tax needs to be 25% or less and [can be changed](/docs/token-management-and-update/updating-taxes-and-limits.md) after deployment. It can be set in steps of 0.1%
{% endhint %}


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