diff --git a/uc_vat.module b/uc_vat.module
index b77e0fb..37eb7da 100644
--- a/uc_vat.module
+++ b/uc_vat.module
@@ -456,7 +456,10 @@ function uc_vat_price_handler_alter(&$price, &$context, &$options) {
   if (uc_vat_exclude_vat()) {
     return;
   }
-
+// Don't do alterations if specific is asked.
+  if (isset($options['uc_vat']) && $options['uc_vat'] == FALSE) {
+    return;
+  }
   if (isset($context['subject']['order']->data['taxes'])) {
     // Use stored tax rates from an existing order if available.
     $tax_rates = $context['subject']['order']->data['taxes'];
@@ -785,6 +788,18 @@ function uc_vat_line_item_tax($op, $order) {
 }
 
 /**
+* Implements hook_calculate_tax()
+*/
+function uc_vat_calculate_tax($order) {
+  $taxes = uc_taxes_calculate_tax(drupal_clone($order));
+  $vats = uc_vat_calculate_vat($order);
+  foreach (array_keys($vats) as $id) {
+    $vats[$id]->amount -= $taxes[$id]->amount;
+  }
+  return $vats;
+}
+
+/**
  * Calculate all taxes on an order using VAT rules.
  *
  * @see uc_taxes_calculate_tax()
@@ -874,7 +889,10 @@ function uc_vat_apply_tax($order, $tax) {
   $taxable_amount = 0;
   if (is_array($order->products)) {
     foreach ($order->products as $item) {
-      $taxable_amount += uc_taxes_apply_item_tax($item, $tax);
+      // We call our own function for applying taxes here, because we don't want to calculate a tax
+      // based on a price altered by this module. If we don't do this, the calculated tax will be
+      // based on a price inclusive tax.
+      $taxable_amount += uc_vat_uc_taxes_apply_item_tax($item, $tax);
     }
   }
   $taxed_line_items = $tax->taxed_line_items;
@@ -922,6 +940,51 @@ function uc_vat_apply_tax($order, $tax) {
 }
 
 /**
+ * Calculates tax for a single product.
+ *
+ * This function is similar to uc_taxes_apply_item_tax(), but with one difference:
+ * It set's an option called uc_vat to FALSE which means to this module that any
+ * price altering by this module should be canceled.
+ * If this module *does* do a price alter when applying taxes, then the tax amount
+ * will be based on the tax inclusive price. And taxes should be based on the tax
+ * *exclusive* price of course!
+ *
+ * @param object $item
+ * @param object $tax
+ * @return float
+ */
+function uc_vat_uc_taxes_apply_item_tax($item, $tax) {
+  $node = node_load($item->nid);
+
+  // Special handling for manually added "Blank line" products.
+  if (!$node) {
+    $node = new stdClass();
+    $node->type = 'blank-line';
+    $node->shippable = $item->weight > 0;
+  }
+
+  // Tax products if they are of a taxed type and if it is shippable if
+  // the tax only applies to shippable products.
+  if (in_array($node->type, $tax->taxed_product_types) && ($tax->shippable == 0 || $node->shippable == 1)) {
+    $context = array(
+      'revision' => 'altered',
+      'type' => 'cart_item',
+      'subject' => array(
+        'cart_item' => $item,
+        'node' => $item->nid ? $node : FALSE,
+      ),
+    );
+    $price_info = array(
+      'price' => $item->price,
+      'qty' => $item->qty,
+    );
+
+    // Calculate price, but bypass any alterations normally done in uc_vat.
+    return uc_price($price_info, $context, $options = array('uc_vat' => FALSE));
+  }
+}
+
+/**
  * Callback for "subtotal excluding VAT" line item.
  */
 function uc_vat_line_item_tax_subtotal($op, $order) {