diff --git a/src/components/MoneyRequestConfirmationList.tsx b/src/components/MoneyRequestConfirmationList.tsx
index ba5c65a4fbd6..0ee82affec7f 100755
--- a/src/components/MoneyRequestConfirmationList.tsx
+++ b/src/components/MoneyRequestConfirmationList.tsx
@@ -42,6 +42,7 @@ import type * as OnyxTypes from '@src/types/onyx';
 import type {Participant} from '@src/types/onyx/IOU';
 import type {PaymentMethodType} from '@src/types/onyx/OriginalMessage';
 import type {SplitShares} from '@src/types/onyx/Transaction';
+import {isEmptyObject} from '@src/types/utils/EmptyObject';
 import ButtonWithDropdownMenu from './ButtonWithDropdownMenu';
 import type {DropdownOption} from './ButtonWithDropdownMenu/types';
 import ConfirmedRoute from './ConfirmedRoute';
@@ -183,7 +184,7 @@ const getTaxAmount = (transaction: OnyxEntry<OnyxTypes.Transaction>, policy: Ony
     if (isDistanceRequest) {
         return DistanceRequestUtils.calculateTaxAmount(policy, transaction, TransactionUtils.getRateID(transaction) ?? '');
     }
-    const defaultTaxCode = TransactionUtils.getDefaultTaxCode(policy, transaction) ?? '';
+    const defaultTaxCode = TransactionUtils.getDefaultTaxCode(policy, TransactionUtils.getCurrency(transaction)) ?? '';
     const taxPercentage = TransactionUtils.getTaxValue(policy, transaction, transaction?.taxCode ?? defaultTaxCode) ?? '';
     return TransactionUtils.calculateTaxAmount(taxPercentage, transaction?.amount ?? 0);
 };
@@ -304,6 +305,15 @@ function MoneyRequestConfirmationList({
 
     const shouldShowTax = isTaxTrackingEnabled(isPolicyExpenseChat, policy, isDistanceRequest) && !isTypeInvoice;
 
+    const transactionCurrency = TransactionUtils.getCurrency(transaction);
+    useEffect(() => {
+        if (isEmptyObject(policy) || !shouldShowTax || !taxRates) {
+            return;
+        }
+        const defaultTaxCode = TransactionUtils.getDefaultTaxCode(policy, transactionCurrency);
+        IOU.setMoneyRequestTaxRate(transactionID, defaultTaxCode ?? '');
+    }, [policy, shouldShowTax, taxRates, transactionCurrency, transactionID]);
+
     // A flag for showing the billable field
     const shouldShowBillable = policy?.disabledFields?.defaultBillable === false;
     const isMovingTransactionFromTrackExpense = IOUUtils.isMovingTransactionFromTrackExpense(action);
diff --git a/src/libs/TransactionUtils.ts b/src/libs/TransactionUtils.ts
index b230d07715a4..46ac56284419 100644
--- a/src/libs/TransactionUtils.ts
+++ b/src/libs/TransactionUtils.ts
@@ -698,10 +698,10 @@ function getRateID(transaction: OnyxEntry<Transaction>): string | undefined {
  * Gets the tax code based on selected currency.
  * Returns policy default tax rate if transaction is in policy default currency, otherwise returns foreign default tax rate
  */
-function getDefaultTaxCode(policy: OnyxEntry<Policy>, transaction: OnyxEntry<Transaction>, currency?: string | undefined) {
+function getDefaultTaxCode(policy: OnyxEntry<Policy>, currency: string) {
     const defaultExternalID = policy?.taxRates?.defaultExternalID;
     const foreignTaxDefault = policy?.taxRates?.foreignTaxDefault;
-    return policy?.outputCurrency === (currency ?? getCurrency(transaction)) ? defaultExternalID : foreignTaxDefault;
+    return policy?.outputCurrency === currency ? defaultExternalID : foreignTaxDefault;
 }
 
 /**
@@ -719,7 +719,7 @@ function transformedTaxRates(policy: OnyxEntry<Policy> | undefined, transaction?
             return defaultExternalID;
         }
 
-        return policy && getDefaultTaxCode(policy, transaction);
+        return policy && getDefaultTaxCode(policy, getCurrency(transaction));
     };
 
     const getModifiedName = (data: TaxRate, code: string) =>
@@ -746,7 +746,7 @@ function getWorkspaceTaxesSettingsName(policy: OnyxEntry<Policy>, taxCode: strin
  * Gets the tax name
  */
 function getTaxName(policy: OnyxEntry<Policy>, transaction: OnyxEntry<Transaction>) {
-    const defaultTaxCode = getDefaultTaxCode(policy, transaction);
+    const defaultTaxCode = getDefaultTaxCode(policy, getCurrency(transaction));
     return Object.values(transformedTaxRates(policy, transaction)).find((taxRate) => taxRate.code === (transaction?.taxCode ?? defaultTaxCode))?.modifiedName;
 }
 
diff --git a/src/pages/iou/request/step/IOURequestStepAmount.tsx b/src/pages/iou/request/step/IOURequestStepAmount.tsx
index e74ed42454aa..6839b5e83d7e 100644
--- a/src/pages/iou/request/step/IOURequestStepAmount.tsx
+++ b/src/pages/iou/request/step/IOURequestStepAmount.tsx
@@ -287,7 +287,7 @@ function IOURequestStepAmount({
 
         // If currency has changed, then we get the default tax rate based on currency, otherwise we use the current tax rate selected in transaction, if we have it.
         const transactionTaxCode = transaction?.taxCode ?? '';
-        const defaultTaxCode = TransactionUtils.getDefaultTaxCode(policy, transaction, currency) ?? '';
+        const defaultTaxCode = TransactionUtils.getDefaultTaxCode(policy, currency ?? TransactionUtils.getCurrency(transaction)) ?? '';
         const taxCode = (currency !== transactionCurrency ? defaultTaxCode : transactionTaxCode) ?? defaultTaxCode;
         const taxPercentage = TransactionUtils.getTaxValue(policy, transaction, taxCode) ?? '';
         const taxAmount = CurrencyUtils.convertToBackendAmount(TransactionUtils.calculateTaxAmount(taxPercentage, newAmount));
diff --git a/src/pages/iou/request/step/IOURequestStepConfirmation.tsx b/src/pages/iou/request/step/IOURequestStepConfirmation.tsx
index 939589598701..03017c7324fc 100644
--- a/src/pages/iou/request/step/IOURequestStepConfirmation.tsx
+++ b/src/pages/iou/request/step/IOURequestStepConfirmation.tsx
@@ -85,7 +85,7 @@ function IOURequestStepConfirmation({
     const receiptFilename = transaction?.filename;
     const receiptPath = transaction?.receipt?.source;
     const receiptType = transaction?.receipt?.type;
-    const defaultTaxCode = TransactionUtils.getDefaultTaxCode(policy, transaction);
+    const defaultTaxCode = TransactionUtils.getDefaultTaxCode(policy, TransactionUtils.getCurrency(transaction));
     const transactionTaxCode = (transaction?.taxCode ? transaction?.taxCode : defaultTaxCode) ?? '';
     const transactionTaxAmount = transaction?.taxAmount ?? 0;
     const isSharingTrackExpense = action === CONST.IOU.ACTION.SHARE;
diff --git a/src/pages/iou/request/step/IOURequestStepTaxAmountPage.tsx b/src/pages/iou/request/step/IOURequestStepTaxAmountPage.tsx
index 27c2808669df..32ad8e8006bb 100644
--- a/src/pages/iou/request/step/IOURequestStepTaxAmountPage.tsx
+++ b/src/pages/iou/request/step/IOURequestStepTaxAmountPage.tsx
@@ -40,7 +40,7 @@ function getTaxAmount(transaction: OnyxEntry<Transaction>, policy: OnyxEntry<Pol
     }
     const transactionTaxAmount = TransactionUtils.getAmount(transaction);
     const transactionTaxCode = transaction?.taxCode ?? '';
-    const defaultTaxCode = TransactionUtils.getDefaultTaxCode(policy, transaction, currency) ?? '';
+    const defaultTaxCode = TransactionUtils.getDefaultTaxCode(policy, currency ?? TransactionUtils.getCurrency(transaction)) ?? '';
     const getTaxValue = (taxCode: string) => TransactionUtils.getTaxValue(policy, transaction, taxCode);
     const defaultTaxValue = getTaxValue(defaultTaxCode);
     const moneyRequestTaxPercentage = (transactionTaxCode ? getTaxValue(transactionTaxCode) : defaultTaxValue) ?? '';