C# webservice referencing dll cannot access external xml file

C# webservice referencing dll cannot access external xml file

I'm building a web service in C#. On this web service I have the following
code:
public class Service1 : System.Web.Services.WebService
{
[WebMethod]
public decimal GetTaxAmountx(decimal amount, int year)
{
decimal result;
result = LB.GetTaxAmount(amount, year);
return result;
}
}
LB is a static class providing a static method GetTaxAmount(decimal
amount, int year). This class is in a dll which I reference from my web
service. The LB.GetTaxAmount method uses linq to xml to load some data,
like this:
var name = from nm in
XElement.Load("Taxes.xml").Elements("Year").Elements("Scale")
where nm.Parent.Attribute("id").Value == year.ToString()
&& (decimal)nm.Element("MoreThan") <= amount
&& (decimal)nm.Element("NotMoreThan") >= amount
select new
{
TaxAmount = nm.Element("TaxAmount"),
Percentage = nm.Element("Percentage"),
MoreThan = nm.Element("MoreThan")
};
Finally LB.GetTaxAmount returns a decimal.
When testing a call to LB.GetTaxAmount by referencing the dll from code in
a plain vanilla class, it all works. But when I test the web service by
entering the parameters and clicking the INVOKE button, it finds the dll
but cannot find the XMl file which I put in the same folder as the ddl
file. I get the following error message:
System.IO.FileNotFoundException: Could not find file 'C:\Program
Files\Microsoft Visual Studio 9.0\Common7\IDE\Taxes.xml'. at
System.IO.__Error.WinIOError(Int32 errorCode, String maybeFullPath) at
System.IO.FileStream.Init(String path, FileMode mode, FileAccess access,
Int32 rights, Boolean useRights, FileShare share, Int32 bufferSize,
FileOptions options, SECURITY_ATTRIBUTES secAttrs, String msgPath, Boolean
bFromProxy) at System.IO.FileStream..ctor(String path, FileMode mode,
FileAccess access, FileShare share, Int32 bufferSize) at
System.Xml.XmlDownloadManager.GetStream(Uri uri, ICredentials credentials)
at System.Xml.XmlUrlResolver.GetEntity(Uri absoluteUri, String role, Type
ofObjectToReturn) at System.Xml.XmlReader.Create(String inputUri,
XmlReaderSettings settings, XmlParserContext inputContext) at
System.Xml.XmlReader.Create(String inputUri, XmlReaderSettings settings)
at System.Xml.Linq.XElement.Load(String uri, LoadOptions options) at
System.Xml.Linq.XElement.Load(String uri) at
AtYourServiceSoftware.LB.GetTaxAmount(Decimal amount, Int32 year) at
sxm3.Service1.GetTaxAmountx(Decimal amount, Int32 year) in C:\Documents
and Settings\user\My Documents\Visual Studio
2008\Projects\sxm3\sxm3\Service1.asmx.cs:line 29
Hope someone knows an answer, thanks in advance. Joost