Sales tax is a consumer tax that is charged at the end of the supply chain. It is used in many US states, and also in some Canadian provinces.
If you are collecting Sales Tax, you will need to add the tax to any sales you make (except where the customer is exempt from sales tax). Although purchases may have sales tax added to them, you will not be able to reclaim these (instead the sales tax portion needs to be included into the purchase price, which MoneyWorks can do automatically for you).
When you first set up MoneyWorks, you therefore need to make sure that the tax rates in the tax table — see Tax Codes are set up for your location. MoneyWorks comes pre-loaded with the sales tax rates for PST in Canada, but not for the myriad of possibilities in the US.
Sales tax on a transaction line is determined by the tax code on the line, and this in turn is normally determined by the settings in the general ledger (although this can be overridden for specific customers and suppliers). Thus your sales general ledger codes will normally all have a tax code on them to make them taxable — see Tax Code.
Although you pay sales tax on purchases, you have to include it in the cost of the item. In MoneyWorks, if there is a sales tax on a purchase/expense transaction, the sales tax portion will automatically be allocated to the general ledger code used on the line. It is therefore possible to have a sales tax code on purchase/expense codes, which can dramatically streamline the entry of these transactions (because each line of the source docket is normally recorded net of tax, with the total tax given at the bottom).