diff --git a/CHANGELOG.md b/CHANGELOG.md
index 9a726cd..b240f79 100644
--- a/CHANGELOG.md
+++ b/CHANGELOG.md
@@ -1,3 +1,7 @@
+# 2.8.0
+
+* [39d869](https://github.com/terraswap/classic-terraswap/pull/16/commits/39d869e9056d92a3094b1995b032e93fe7068ddb) Do not deduct tax in ibc token
+
 # 2.7.0
 
 * [a189de](https://github.com/terraswap/classic-terraswap/pull/15/commits/a189de88440f5a26e4104aa950fddbcb259a457e) Prevention of share calculation overflow
diff --git a/Cargo.lock b/Cargo.lock
index ebf4614..d1171bf 100644
--- a/Cargo.lock
+++ b/Cargo.lock
@@ -13,6 +13,15 @@ dependencies = [
  "version_check",
 ]
 
+[[package]]
+name = "aho-corasick"
+version = "1.1.2"
+source = "registry+https://github.com/rust-lang/crates.io-index"
+checksum = "b2969dcb958b36655471fc61f7e416fa76033bdd4bfed0678d8fee1e2d07a1f0"
+dependencies = [
+ "memchr",
+]
+
 [[package]]
 name = "autocfg"
 version = "1.0.1"
@@ -93,7 +102,7 @@ dependencies = [
 
 [[package]]
 name = "classic_terraswap"
-version = "2.7.0"
+version = "2.8.0"
 dependencies = [
  "classic-bindings",
  "cosmwasm-schema",
@@ -101,6 +110,7 @@ dependencies = [
  "cosmwasm-storage",
  "cw2",
  "cw20",
+ "lazy-regex",
  "protobuf",
  "schemars",
  "serde",
@@ -514,12 +524,41 @@ dependencies = [
  "sha2 0.10.6",
 ]
 
+[[package]]
+name = "lazy-regex"
+version = "3.0.2"
+source = "registry+https://github.com/rust-lang/crates.io-index"
+checksum = "e723bd417b2df60a0f6a2b6825f297ea04b245d4ba52b5a22cb679bdf58b05fa"
+dependencies = [
+ "lazy-regex-proc_macros",
+ "once_cell",
+ "regex-lite",
+]
+
+[[package]]
+name = "lazy-regex-proc_macros"
+version = "3.0.1"
+source = "registry+https://github.com/rust-lang/crates.io-index"
+checksum = "0f0a1d9139f0ee2e862e08a9c5d0ba0470f2aa21cd1e1aa1b1562f83116c725f"
+dependencies = [
+ "proc-macro2",
+ "quote",
+ "regex",
+ "syn 2.0.18",
+]
+
 [[package]]
 name = "libc"
 version = "0.2.146"
 source = "registry+https://github.com/rust-lang/crates.io-index"
 checksum = "f92be4933c13fd498862a9e02a3055f8a8d9c039ce33db97306fd5a6caa7f29b"
 
+[[package]]
+name = "memchr"
+version = "2.6.4"
+source = "registry+https://github.com/rust-lang/crates.io-index"
+checksum = "f665ee40bc4a3c5590afb1e9677db74a508659dfd71e126420da8274909a0167"
+
 [[package]]
 name = "num-traits"
 version = "0.2.12"
@@ -593,6 +632,41 @@ dependencies = [
  "getrandom",
 ]
 
+[[package]]
+name = "regex"
+version = "1.10.2"
+source = "registry+https://github.com/rust-lang/crates.io-index"
+checksum = "380b951a9c5e80ddfd6136919eef32310721aa4aacd4889a8d39124b026ab343"
+dependencies = [
+ "aho-corasick",
+ "memchr",
+ "regex-automata",
+ "regex-syntax",
+]
+
+[[package]]
+name = "regex-automata"
+version = "0.4.3"
+source = "registry+https://github.com/rust-lang/crates.io-index"
+checksum = "5f804c7828047e88b2d32e2d7fe5a105da8ee3264f01902f796c8e067dc2483f"
+dependencies = [
+ "aho-corasick",
+ "memchr",
+ "regex-syntax",
+]
+
+[[package]]
+name = "regex-lite"
+version = "0.1.5"
+source = "registry+https://github.com/rust-lang/crates.io-index"
+checksum = "30b661b2f27137bdbc16f00eda72866a92bb28af1753ffbd56744fb6e2e9cd8e"
+
+[[package]]
+name = "regex-syntax"
+version = "0.8.2"
+source = "registry+https://github.com/rust-lang/crates.io-index"
+checksum = "c08c74e62047bb2de4ff487b251e4a92e24f48745648451635cec7d591162d9f"
+
 [[package]]
 name = "rfc6979"
 version = "0.3.1"
@@ -802,7 +876,7 @@ dependencies = [
 
 [[package]]
 name = "terraswap-pair"
-version = "0.2.0"
+version = "0.3.0"
 dependencies = [
  "classic-bindings",
  "classic_terraswap",
@@ -821,7 +895,7 @@ dependencies = [
 
 [[package]]
 name = "terraswap-router"
-version = "0.1.0"
+version = "0.2.0"
 dependencies = [
  "classic-bindings",
  "classic_terraswap",
diff --git a/contracts/terraswap_factory/Cargo.toml b/contracts/terraswap_factory/Cargo.toml
index f786cda..e493da0 100644
--- a/contracts/terraswap_factory/Cargo.toml
+++ b/contracts/terraswap_factory/Cargo.toml
@@ -42,7 +42,7 @@ cw-storage-plus = { version = "1.0.0" }
 schemars = "0.8.1"
 serde = { version = "1.0.103", default-features = false, features = ["derive"] }
 protobuf = { version = "2", features = ["with-bytes"] }
-classic_terraswap = { path = "../../packages/classic_terraswap", default-features = false, version = "2.7.0"}
+classic_terraswap = { path = "../../packages/classic_terraswap", default-features = false, version = "2.8.0"}
 
 [dev-dependencies]
 cosmwasm-schema = { version = "1.0.0"}
diff --git a/contracts/terraswap_pair/Cargo.toml b/contracts/terraswap_pair/Cargo.toml
index 50bebe8..04e38e7 100644
--- a/contracts/terraswap_pair/Cargo.toml
+++ b/contracts/terraswap_pair/Cargo.toml
@@ -1,6 +1,6 @@
 [package]
 name = "terraswap-pair"
-version = "0.2.0"
+version = "0.3.0"
 authors = ["Terraform Labs, PTE.", "DELIGHT LABS"]
 edition = "2021"
 description = "A Terraswap pair contract"
@@ -44,7 +44,7 @@ serde = { version = "1.0.103", default-features = false, features = ["derive"] }
 thiserror = { version = "1.0.20" }
 protobuf = { version = "2", features = ["with-bytes"] }
 classic-bindings = { version = "0.1.1" }
-classic_terraswap = { path = "../../packages/classic_terraswap", default-features = false, version = "2.7.0"}
+classic_terraswap = { path = "../../packages/classic_terraswap", default-features = false, version = "2.8.0"}
 
 [dev-dependencies]
 cosmwasm-schema = { version = "1.0.0" }
diff --git a/contracts/terraswap_pair/src/contract.rs b/contracts/terraswap_pair/src/contract.rs
index fdc293c..de5794a 100644
--- a/contracts/terraswap_pair/src/contract.rs
+++ b/contracts/terraswap_pair/src/contract.rs
@@ -868,7 +868,7 @@ pub fn assert_minimum_assets(
     Ok(())
 }
 
-const TARGET_CONTRACT_VERSION: &str = "0.1.1";
+const TARGET_CONTRACT_VERSION: &str = "0.2.0";
 #[cfg_attr(not(feature = "library"), entry_point)]
 pub fn migrate(
     deps: DepsMut<TerraQuery>,
diff --git a/contracts/terraswap_router/Cargo.toml b/contracts/terraswap_router/Cargo.toml
index a10f118..88c4852 100644
--- a/contracts/terraswap_router/Cargo.toml
+++ b/contracts/terraswap_router/Cargo.toml
@@ -1,6 +1,6 @@
 [package]
 name = "terraswap-router"
-version = "0.1.0"
+version = "0.2.0"
 authors = ["Terraform Labs, PTE.", "DELIGHT LABS"]
 edition = "2021"
 description = "A Terraswap router contract - provides multi-step operations to facilitate single sign operation"
@@ -37,7 +37,7 @@ backtraces = ["cosmwasm-std/backtraces"]
 cw2 = { version = "0.14.0" }
 cw20 = { version = "0.14.0" }
 cosmwasm-std = { version = "1.0.0" }
-classic_terraswap = { path = "../../packages/classic_terraswap", version = "2.7.0" }
+classic_terraswap = { path = "../../packages/classic_terraswap", version = "2.8.0" }
 classic-bindings = { version = "0.1.1" }
 cw-storage-plus = { version = "1.0.0"}
 integer-sqrt = "0.1.5"
diff --git a/contracts/terraswap_router/src/contract.rs b/contracts/terraswap_router/src/contract.rs
index 555a4d3..ecc7cce 100644
--- a/contracts/terraswap_router/src/contract.rs
+++ b/contracts/terraswap_router/src/contract.rs
@@ -20,7 +20,7 @@ use classic_terraswap::router::{
     ConfigResponse, Cw20HookMsg, ExecuteMsg, InstantiateMsg, MigrateMsg, QueryMsg,
     SimulateSwapOperationsResponse, SwapOperation,
 };
-use classic_terraswap::util::assert_deadline;
+use classic_terraswap::util::{assert_deadline, migrate_version};
 use cw20::Cw20ReceiveMsg;
 use std::collections::HashMap;
 
@@ -216,8 +216,7 @@ fn assert_minimum_receive(
 
     if swap_amount < minium_receive {
         return Err(StdError::generic_err(format!(
-            "assertion failed; minimum receive amount: {}, swap amount: {}",
-            minium_receive, swap_amount
+            "assertion failed; minimum receive amount: {minium_receive}, swap amount: {swap_amount}",
         )));
     }
 
@@ -638,8 +637,19 @@ fn test_invalid_operations() {
     .is_err());
 }
 
+const TARGET_CONTRACT_VERSION: &str = "0.1.0";
 #[cfg_attr(not(feature = "library"), entry_point)]
-pub fn migrate(deps: DepsMut, _env: Env, _msg: MigrateMsg) -> StdResult<Response> {
-    set_contract_version(deps.storage, CONTRACT_NAME, CONTRACT_VERSION)?;
+pub fn migrate(
+    deps: DepsMut<TerraQuery>,
+    _env: Env,
+    _msg: MigrateMsg,
+) -> StdResult<Response<TerraMsg>> {
+    migrate_version(
+        deps,
+        TARGET_CONTRACT_VERSION,
+        CONTRACT_NAME,
+        CONTRACT_VERSION,
+    )?;
+
     Ok(Response::default())
 }
diff --git a/contracts/terraswap_router/src/querier.rs b/contracts/terraswap_router/src/querier.rs
index b70885f..7a3fb93 100644
--- a/contracts/terraswap_router/src/querier.rs
+++ b/contracts/terraswap_router/src/querier.rs
@@ -1,3 +1,4 @@
+use classic_terraswap::asset::IBC_REX;
 use cosmwasm_std::{Decimal, Decimal256, QuerierWrapper, StdResult, Uint128, Uint256};
 use std::ops::Mul;
 
@@ -10,6 +11,10 @@ pub fn compute_tax(
     amount: Uint128,
     denom: String,
 ) -> StdResult<Uint128> {
+    if IBC_REX.is_match(&denom) {
+        return Ok(Uint128::zero());
+    }
+
     let terra_querier = TerraQuerier::new(querier);
     let tax_rate: Decimal = (terra_querier.query_tax_rate()?).rate;
     let tax_cap: Uint128 = (terra_querier.query_tax_cap(denom)?).cap;
@@ -27,6 +32,10 @@ pub fn compute_reverse_tax(
     amount: Uint128,
     denom: String,
 ) -> StdResult<Uint128> {
+    if IBC_REX.is_match(&denom) {
+        return Ok(Uint128::zero());
+    }
+
     let terra_querier = TerraQuerier::new(querier);
     let tax_rate: Decimal = (terra_querier.query_tax_rate()?).rate;
     let tax_cap: Uint128 = (terra_querier.query_tax_cap(denom)?).cap;
diff --git a/contracts/terraswap_token/Cargo.toml b/contracts/terraswap_token/Cargo.toml
index 85b8ba6..d044ec1 100644
--- a/contracts/terraswap_token/Cargo.toml
+++ b/contracts/terraswap_token/Cargo.toml
@@ -26,7 +26,7 @@ cosmwasm-std = { version = "1.0.0" }
 schemars = "0.8.1"
 serde = { version = "1.0.103", default-features = false, features = ["derive"] }
 thiserror = { version = "1.0.20" }
-classic_terraswap = { path = "../../packages/classic_terraswap", version = "2.7.0" }
+classic_terraswap = { path = "../../packages/classic_terraswap", version = "2.8.0" }
 
 [dev-dependencies]
 # we only need to enable this if we use integration tests
diff --git a/packages/classic_terraswap/Cargo.toml b/packages/classic_terraswap/Cargo.toml
index 59dd1b1..79e0a8a 100644
--- a/packages/classic_terraswap/Cargo.toml
+++ b/packages/classic_terraswap/Cargo.toml
@@ -1,6 +1,6 @@
 [package]
 name = "classic_terraswap"
-version = "2.7.0"
+version = "2.8.0"
 authors = ["Terraform Labs, PTE.", "DELIGHT LABS"]
 edition = "2021"
 description = "Common terraswap types"
@@ -25,6 +25,7 @@ cosmwasm-std = { version = "1.0.0" }
 schemars = "0.8.1"
 serde = { version = "1.0.103", default-features = false, features = ["derive"] }
 protobuf = { version = "2", features = ["with-bytes"] }
+lazy-regex = {version = "3.0.2", default-features = false, features = ["lite"]}
 
 [dev-dependencies]
 cosmwasm-schema = { version = "1.0.0" }
diff --git a/packages/classic_terraswap/src/asset.rs b/packages/classic_terraswap/src/asset.rs
index 9b1721e..fdd3266 100644
--- a/packages/classic_terraswap/src/asset.rs
+++ b/packages/classic_terraswap/src/asset.rs
@@ -1,3 +1,4 @@
+use lazy_regex::*;
 use schemars::JsonSchema;
 use serde::{Deserialize, Serialize};
 use std::fmt;
@@ -10,6 +11,8 @@ use cosmwasm_std::{
 };
 use cw20::Cw20ExecuteMsg;
 
+pub static IBC_REX: Lazy<Regex> = lazy_regex!("^ibc/[A-F0-9]{64}$");
+
 #[derive(Serialize, Deserialize, Clone, Debug, PartialEq, Eq, JsonSchema)]
 pub struct Asset {
     pub info: AssetInfo,
@@ -32,6 +35,10 @@ impl Asset {
     pub fn compute_tax(&self, querier: &QuerierWrapper<TerraQuery>) -> StdResult<Uint128> {
         let amount = self.amount;
         if let AssetInfo::NativeToken { denom } = &self.info {
+            if self.info.is_ibc_token() {
+                return Ok(Uint128::zero());
+            }
+
             let terra_querier = TerraQuerier::new(querier);
             let tax_rate: Decimal = (terra_querier.query_tax_rate()?).rate;
             let tax_cap: Uint128 = (terra_querier.query_tax_cap(denom.to_string())?).cap;
@@ -140,8 +147,8 @@ pub enum AssetInfo {
 impl fmt::Display for AssetInfo {
     fn fmt(&self, f: &mut fmt::Formatter) -> fmt::Result {
         match self {
-            AssetInfo::NativeToken { denom } => write!(f, "{}", denom),
-            AssetInfo::Token { contract_addr } => write!(f, "{}", contract_addr),
+            AssetInfo::NativeToken { denom } => write!(f, "{denom}"),
+            AssetInfo::Token { contract_addr } => write!(f, "{contract_addr}"),
         }
     }
 }
@@ -164,6 +171,20 @@ impl AssetInfo {
             AssetInfo::Token { .. } => false,
         }
     }
+
+    pub fn is_ibc_token(&self) -> bool {
+        match self {
+            AssetInfo::NativeToken { denom } => {
+                if IBC_REX.is_match(denom) {
+                    return true;
+                }
+
+                false
+            }
+            AssetInfo::Token { .. } => false,
+        }
+    }
+
     pub fn query_pool(
         &self,
         querier: &QuerierWrapper<TerraQuery>,
diff --git a/packages/classic_terraswap/src/mock_querier.rs b/packages/classic_terraswap/src/mock_querier.rs
index 5733074..2228e5e 100644
--- a/packages/classic_terraswap/src/mock_querier.rs
+++ b/packages/classic_terraswap/src/mock_querier.rs
@@ -135,7 +135,7 @@ impl Querier for WasmMockQuerier {
             Ok(v) => v,
             Err(e) => {
                 return SystemResult::Err(SystemError::InvalidRequest {
-                    error: format!("Parsing query request: {}", e),
+                    error: format!("Parsing query request: {e}"),
                     request: bin_request.into(),
                 })
             }
@@ -248,9 +248,8 @@ impl WasmMockQuerier {
                                     None => {
                                         return SystemResult::Err(SystemError::InvalidRequest {
                                             error: format!(
-                                                "No balance info exists for the contract {}",
-                                                contract_addr
-                                            ),
+                                        "No balance info exists for the contract {contract_addr}"
+                                    ),
                                             request: msg.as_slice().into(),
                                         })
                                     }
@@ -279,9 +278,8 @@ impl WasmMockQuerier {
                                     None => {
                                         return SystemResult::Err(SystemError::InvalidRequest {
                                             error: format!(
-                                                "No balance info exists for the contract {}",
-                                                contract_addr
-                                            ),
+                                        "No balance info exists for the contract {contract_addr}"
+                                    ),
                                             request: msg.as_slice().into(),
                                         })
                                     }
diff --git a/packages/classic_terraswap/src/testing.rs b/packages/classic_terraswap/src/testing.rs
index a8c0169..55a90c1 100644
--- a/packages/classic_terraswap/src/testing.rs
+++ b/packages/classic_terraswap/src/testing.rs
@@ -107,6 +107,12 @@ fn test_asset_info() {
     let native_token_info: AssetInfo = AssetInfo::NativeToken {
         denom: "uusd".to_string(),
     };
+    let ibc_token_info: AssetInfo = AssetInfo::NativeToken {
+        denom: "ibc/7F8A299575858D452509369851605DCD9D4595EB967E805388347FD54852AA62".to_string(),
+    };
+    let invaild_ibc_token_info: AssetInfo = AssetInfo::NativeToken {
+        denom: "ibc/7".to_string(),
+    };
 
     assert!(!token_info.equal(&native_token_info));
 
@@ -120,6 +126,12 @@ fn test_asset_info() {
 
     assert!(native_token_info.is_native_token());
     assert!(!token_info.is_native_token());
+    assert!(ibc_token_info.is_native_token());
+
+    assert!(ibc_token_info.is_ibc_token());
+    assert!(!invaild_ibc_token_info.is_ibc_token());
+    assert!(!native_token_info.is_ibc_token());
+    assert!(!native_token_info.is_ibc_token());
 
     let mut deps = mock_dependencies(&[Coin {
         denom: "uusd".to_string(),