if you view source of the confirm page, this is the information sent to paypal:
<input type="hidden" name="amount_1" id="amount_1" value="29.95" />
<input type="hidden" name="item_name_1" id="item_name_1" value="My Life Rulz Children's Book & DVD" />
<input type="hidden" name="item_number_1" id="item_number_1" value="1" />
<input type="hidden" name="quantity_1" id="quantity_1" value="1" />
<input type="hidden" name="on0_1" id="on0_1" value="" />
<input type="hidden" name="os0_1" id="os0_1" value="" />
<input type="hidden" name="on1_1" id="on1_1" value="" />
<input type="hidden" name="os1_1" id="os1_1" value="" />
<input type="hidden" name="handling_cart" id="handling_cart" value="9.75" />
<input type="hidden" name="tax_cart" id="tax_cart" value="2.72" />
<input type="hidden" name="no_note" id="no_note" value="0" />
<input type="hidden" name="no_shipping" id="no_shipping" value="0" />
<input type="hidden" name="cancel_return" id="cancel_return" value="" />
<input type="hidden" name="return" id="return" value="" />
<input type="hidden" name="cmd" id="cmd" value="_cart" />
<input type="hidden" name="upload" id="upload" value="1" />
<input type="hidden" name="currency_code" id="currency_code" value="AUD" />
<input type="hidden" name="address_override" id="address_override" value="1" />
<input type="hidden" name="first_name" id="first_name" value="test" />
<input type="hidden" name="last_name" id="last_name" value="test" />
<input type="hidden" name="address1" id="address1" value="1234" />
<input type="hidden" name="address2" id="address2" value="" />
<input type="hidden" name="city" id="city" value="test" />
<input type="hidden" name="state" id="state" value="VIC" />
<input type="hidden" name="zip" id="zip" value="852" />
<input type="hidden" name="country" id="country" value="AU" />
it looks like you dont want to pass the tax:
<input type="hidden" name="tax_cart" id="tax_cart" value="2.72" />
to paypal because it is included in the price.