Magento – Change Tax text to VAT

I've managed to solve my problem by following this thread : Modify tax rate on cart quote items and recalculate

I have added an Observer to the event sales_quote_collect_totals_before.

And here is the content of my observer, very simple :

public function removetax($observer)
{
    $customer_id = Mage::getSingleton('customer/session')->getId();
    $customer = Mage::getModel("customer/customer")->load($customer_id);

    if($customer->getIsTaxExempt() == 1)
    {
        $items = $observer->getEvent()->getQuote()->getAllVisibleItems();
        foreach($items as $item)
            $item->getProduct()->setTaxClassId(0);
    }
}

Explanation : I load the current customer object in order to access the is_tax_exempt attribute. If customer is tax exempt, I grab the current cart content and for each item, I set the product tax class to 0. It is mandatory to not save the product or the item. The aim here is to set a value for the following calculation, not to save it in the database. Tax classes need to stay to the initial value in the db.

So by setting the tax class for this event, the following calculation will use the information setted in the observer. This seems to be a very clean method to achieve my first problem.

This is most likely due to the Tax Origin not being set correctly (it's probably on its default: US). This is different from the Default Country setting, you can find it at System -> Configuration -> [SALES] Tax -> Origin.

Let me know if it works! :)