When I was in the US, I also had to mentally adjust for the incomplete, tax-less, pricing at places.
At the airport, I thought I could buy one last thing from my last few coins and bills of change. Quite a bummer at the register when it turned out it was actually more expensive.
In Europe, sometimes prices even list both the VAT included and excluded prices.
What's the point of even having a price sticker if what's charged is more than what it says? Are some people exempt from the sales tax added? Is it dynamic depdending on the total amount charged?
> What's the point of even having a price sticker if what's charged is more than what it says?
It's because cities can have local sales tax, but advertising campaigns are national, or at last wider than a single city. So it's impossible to advertise the final price unless you micro-target a single area.
Because of this it became the custom not to include tax on any prices.
Unlike Europe there is no sales tax on a national level in the US (except for gasoline), so there is no tax that could be listed that applies to everyone.
(And gasoline, it should be noted, is always advertised with all taxes included.)
> Are some people exempt from the sales tax added?
Yes, certain non profits do not pay sales tax. You can show the sales person a document with your tax free status and it won't be added. (You'll have to sign something attesting you will not use it for personal use, but only for the purposes of the non-profit.)
> Is it dynamic depdending on the total amount charged?
Only for some luxury items, where below a certain amount it's not considered a luxury and the tax is lower.
> It's because cities can have local sales tax, but advertising campaigns are national, or at last wider than a single city. So it's impossible to advertise the final price unless you micro-target a single area.
Yeah I was thinking about actual price tags on products or store shelves. Not billboards or tv ads etc. Doesn't explain why something would be marked $1.00 and charged $1.10 at the register (for example). I see how it could be advertised as $1.00 (+VAT) in a national ad though.
> Yes, certain non profits do not pay sales tax.
If 99% of the customers do pay the tax, wouldn't it help the customers most to mark the products and store shelves with what they will be charged?
With a receipt from the same chain, yes. And on the receipt you always have both the with/without VAT prices listed. So when returning there should be no confusion.
Still doesn't explain what the point would be to display $1.00 on a shelf, if I will be charged $1.10 at the register with VAT.
> It's because cities can have local sales tax, but advertising campaigns are national, or at last wider than a single city. So it's impossible to advertise the final price unless you micro-target a single area.
Yeah, but even bodegas and NYC-only restaurants do this.
Then don't print the price on at manufacture time.
In any case, why is it any more reasonable to presume or mandate that the price be the same everywhere before tax and different after tax, than it would be to presume or mandate that the price before tax be adjusted to be the same after tax? Surely sales tax is not the only cost that varies between sales channels.
Why is this useful? You can argue for both, but to argue for only showing the tax free price is just hiding the price; It's not like you can ask for the tax to be taken off.
In the UK we have a default all included price on items for example in supermarkets, but in wholesale shops targeting businesses prices will be shown as with and without VAT as businesses can reclaim it. Makes perfect sense, reduces cognitive load, makes comparison of prices easier, means the consumer doesn't need to understand the implications of the tax system on every purchase.
When I buy groceries here in Norway, there is VAT: 15% on most food, 25% on most other items, and none on newspapers, magazines, and books. It is common for me to buy a mix of items at the store.
All of the prices listed on the shelf include this VAT tax, which is similar to the sales tax in the US. I can always figure out what I'm going to pay, save for guessing some prices for weighed goods.
On the reciept, there is a line telling me how much of the total bill was taxes. Therefore I can always know how much goes to the tax man.
Even if I was living in the states, it isn't so hard to figure out so long as you have calculator access and know the local sales tax amount.
The way we do it here in Brazil is better for that: the price includes the taxes, but the receipt has a field which shows how much of the total was for the municipal, state, and federal taxes.
Yeah, I can see how it would be useful just like the regular price is informative if you have a sale. But still - if I want to see one price I want to see what I'm being charged at the register.
At the airport, I thought I could buy one last thing from my last few coins and bills of change. Quite a bummer at the register when it turned out it was actually more expensive.
In Europe, sometimes prices even list both the VAT included and excluded prices.