How is Tax calculated in AWS

This depends on the country of registration for your account, your account settings, and by which entity you are billed - https://aws.amazon.com/tax-help/

I suggest, if you have any specific concerns related to how tax is applied to usage on your account, to open a billing support case https://docs.aws.amazon.com/awssupport/latest/user/case-example.html and clarify with the support team, as they'll be able to advise better depending on your account settings.

But here's an example: if you're based anywhere in EMEA, depending on your country, you will be charged different VAT rate - https://aws.amazon.com/tax-help/emea-vat-tables/ - for example, if you're in Germany, you'll get 19% VAT charged on top of your regular AWS usage charges.

For any specific use cases, I suggest checking with support.