diff --git a/integration-tests/modules/__tests__/order/draft-order.spec.ts b/integration-tests/modules/__tests__/order/draft-order.spec.ts
index b3d26b1766..6aee2d4a2b 100644
--- a/integration-tests/modules/__tests__/order/draft-order.spec.ts
+++ b/integration-tests/modules/__tests__/order/draft-order.spec.ts
@@ -386,6 +386,169 @@ medusaIntegrationTestRunner({
 
         expect(response.status).toEqual(200)
       })
+      it("should create a draft order and apply tax by product type", async () => {
+        const productType = await productModule.createProductTypes({
+          value: "test_product_type",
+        })
+
+        const region = await regionModuleService.createRegions({
+          name: "US",
+          currency_code: "usd",
+        })
+
+        const [taxRegion] = await taxModule.createTaxRegions([{
+          country_code: "US",
+          provider_id: "tp_system",
+          default_tax_rate: { name: "US Default Rate", rate: 5, code: "US_DEF" },
+        }])
+
+        const [taxRate] = await taxModule.createTaxRates([
+          {
+            tax_region_id: taxRegion.id,
+            name: "US Reduced",
+            rate: 3,
+            code: "USREDUCE_PROD_TYPE",
+          }])
+
+        await taxModule.createTaxRateRules([
+          {
+            reference: "product_type",
+            reference_id: productType.id,
+            tax_rate_id: taxRate.id,
+          }
+        ])
+
+        const salesChannel = await scModuleService.createSalesChannels({
+          name: "Webshop",
+        })
+
+        const location = await stockLocationModule.createStockLocations({
+          name: "Warehouse",
+        })
+
+
+        const [product] = await productModule.createProducts([
+          {
+            title: "Test product",
+            type_id: productType.id,
+            variants: [
+              {
+                title: "Test variant",
+              },
+            ],
+          },
+        ])
+
+        const inventoryItem = await inventoryModule.createInventoryItems({
+          sku: "inv-1234",
+        })
+
+        await inventoryModule.createInventoryLevels([
+          {
+            inventory_item_id: inventoryItem.id,
+            location_id: location.id,
+            stocked_quantity: 2,
+            reserved_quantity: 0,
+          },
+        ])
+
+        const [priceSet] = await pricingModule.createPriceSets([
+          {
+            prices: [
+              {
+                amount: 3000,
+                currency_code: "usd",
+              },
+            ],
+          },
+        ])
+
+        await api.post(
+          "/admin/price-preferences",
+          {
+            attribute: "currency_code",
+            value: "usd",
+            is_tax_inclusive: true,
+          },
+          adminHeaders
+        )
+
+
+        await remoteLink.create([
+          {
+            [Modules.PRODUCT]: {
+              variant_id: product.variants[0].id,
+            },
+            [Modules.PRICING]: {
+              price_set_id: priceSet.id,
+            },
+          },
+          {
+            [Modules.SALES_CHANNEL]: {
+              sales_channel_id: salesChannel.id,
+            },
+            [Modules.STOCK_LOCATION]: {
+              stock_location_id: location.id,
+            },
+          },
+          {
+            [Modules.PRODUCT]: {
+              variant_id: product.variants[0].id,
+            },
+            [Modules.INVENTORY]: {
+              inventory_item_id: inventoryItem.id,
+            },
+          },
+        ])
+
+        const payload = {
+          email: "oli@test.dk",
+          region_id: region.id,
+          sales_channel_id: salesChannel.id,
+          currency_code: "usd",
+          shipping_address: {
+            first_name: "Test",
+            last_name: "Test",
+            address_1: "Test",
+            city: "Test",
+            country_code: "US",
+            postal_code: "12345",
+            phone: "12345",
+          },
+          billing_address: {
+            first_name: "Test",
+            last_name: "Test",
+            address_1: "Test",
+            city: "Test",
+            country_code: "US",
+            postal_code: "12345",
+          },
+          promo_codes: ["testytest"],
+          items: [
+            {
+              variant_id: product.variants[0].id,
+              product_type_id: productType.id,
+              quantity: 2,
+            },
+          ],
+          shipping_methods: [
+            {
+              name: "test-method",
+              shipping_option_id: "test-option",
+              amount: 100,
+            },
+          ],
+        }
+
+        const response = await api.post(
+          "/admin/draft-orders",
+          payload,
+          adminHeaders
+        )
+
+        expect(response.data.draft_order.items[0].tax_lines[0].code).toEqual("USREDUCE_PROD_TYPE")
+        expect(response.data.draft_order.items[0].tax_lines[0].rate).toEqual(3)
+      })
     })
   },
 })
diff --git a/packages/core/core-flows/src/order/utils/fields.ts b/packages/core/core-flows/src/order/utils/fields.ts
index c53bb7ea54..a82aea39a2 100644
--- a/packages/core/core-flows/src/order/utils/fields.ts
+++ b/packages/core/core-flows/src/order/utils/fields.ts
@@ -11,6 +11,7 @@ export const productVariantsFields = [
   "product.subtitle",
   "product.thumbnail",
   "product.type.value",
+  "product.type.id",
   "product.collection.title",
   "product.handle",
   "calculated_price.*",
diff --git a/packages/core/core-flows/src/order/workflows/update-tax-lines.ts b/packages/core/core-flows/src/order/workflows/update-tax-lines.ts
index a7cf15f1a2..3333f45471 100644
--- a/packages/core/core-flows/src/order/workflows/update-tax-lines.ts
+++ b/packages/core/core-flows/src/order/workflows/update-tax-lines.ts
@@ -24,6 +24,7 @@ const completeOrderFields = [
   "items.product_description",
   "items.product_subtitle",
   "items.product_type",
+  "items.product_type_id",
   "items.product_collection",
   "items.product_handle",
   "items.variant_sku",
@@ -107,6 +108,7 @@ const lineItemFields = [
   "product_description",
   "product_subtitle",
   "product_type",
+  "product_type_id",
   "product_collection",
   "product_handle",
   "variant_sku",