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How can I let vendors on my site set their own tax rules instead of setting rules for the entire marketplace as a whole?

Unfortunately, it is not possible to let each vendor set up their own tax rules. Tax rates will be the same for all vendors and will be inherited from the main shop, no matter where the vendor is from.
Yet, it is possible to choose whether to credit taxes to the vendor, the admin or split them between them both. You can configure this settings from the Commissions settings page.