True, my views are non-American. For example when I go to a convenience store, I pay the price listed on the item. I don't have to do math in my head that's +x% sales or state tax. That type of practice just isn't acceptable anywhere else.
I now live in the Netherlands. All prices are what you pay, _and_ the receipt breaks down how much of that goes to taxes, which I think is completely logical.
I like the solution we have - price stickers have full price, and printed receipts carry tax breakdown.
By making tax as difficult as possible, they recruit supporters for their anti-tax stance, and they can claim they're delivering on their anti-tax policy by 'making the system collapse under its own weight' or 'making everyone aware of how much tax they're paying' and they can allow loopholes and fraud opportunities and they can collect donations from tax preparation companies.
Especially considering the fact that usually there are 2-3 rates tops, so one can easily remember that 5-10-20% of what they pay goes to the country coffers depending on the product being bought.
Regardless of the rounding method, the fair way is to sum up purchases and compute tax on the total, precisely to minimize the loss of precision on rounding.
Curiously, as far as I understand the Polish tax code (IANAL), the choice of the method to use is actually given to the vendor! The law recommends[0] that you calculate the tax by multiplying the rate with the total taxable amount, but also allows[1] the seller to choose to calculate per-item tax, and sum that. In both cases, mathematical rounding (half-up) is used[2].
But in practice, there's little to no difference unless you're doing a single purchase of a lot of items with weird pricing bias.
--
[0] - Dz.U.2020.0.106 t.j. - Ustawa z dnia 11 marca 2004 r. o podatku od towarów i usług, art. 106e., ust. 7.
[1] - ibid., ust. 10.
[2] - ibid., ust. 11.
Agreed! If they are actually rounding it will be a statistical wash.
> Regardless of the rounding method, the fair way is to sum up purchases and compute tax on the total, precisely to minimize the loss of precision on rounding.
Again, agreed, this is why we do it this way in the US.
> Curiously, as far as I understand the Polish tax code (IANAL), the choice of the method to use is actually given to the vendor! The law recommends[0] that you calculate the tax by multiplying the rate with the total taxable amount, but also allows[1] the seller to choose to calculate per-item tax, and sum that. In both cases, mathematical rounding (half-up) is used[2].
US tax code, at least as far as income taxes go, uses the same rounding method (nearest decimal) however sales tax is can be quite a bit more complicated [1].
Also somewhat related, we quote our fuel prices to 3 decimals.
[1] - https://blog.taxjar.com/rounding-issues-sales-tax-returns/
Does the sticker have to show all taxes or just the sales tax/GST/VAT? I know that pretty much every country in the world has an alcohol tax that is applied to things like wine. So should the sticker also include that?
In the USA they have a particular hatred of making tax easier to pay. There's a political affiliation whose goal is to make filing a tax return harder and more complicated to do so that people will complain more about it and hate the process. So that has created the tax return filing industry and associated lobby groups. So having sales tax need to be applied on top fits within this world view.
But yes I completely agree that the sticker price should include what you actually end up paying for that item. I also like it in some countries where there's a unit or weight cost with the item, so you can more easily compare different branded products. Though they usually make this number comically small on the price tag to make it harder to compare.
Which political affiliation and what gives you this idea?
One name that popped up after a quick search inside a long article was Grover Norquist. From his Wikipedia entry he is part of a political association which wants to prevent any rise in taxes. From another article I read long ago it was mentioned that this includes preventing automatic filing since the government could introduce new taxes without people knowing.
> In the USA they have a particular hatred of making tax easier to pay. There's a political affiliation whose goal is to make filing a tax return harder and more complicated to do so that people will complain more about it and hate the process. So that has created the tax return filing industry and associated lobby groups. So having sales tax need to be applied on top fits within this world view.
It's actually this:
> since the government could introduce new taxes without people knowing
Along with increasing gov size, increasing gov expense, and destroying another industry.
I'm all for increased competition in tax filing software, and you're starting to see open source competition here as well. But spreading opinion as fact, and in this case in particularly, is called "misinformation" or "fake news"
There are groups of people (political association) and vested interests (lobbyists) who want to make tax harder to pay than it needs to be so they can profit from it, either politically or financially.
In addition you need to manually calculate the sales tax for every different county in the USA on top of the sticker price. It has been suggested that this is enshrined in law and/or done by the stores themselves, but the net effect is that this sales tax is at the forefront of people's minds when going shopping.
Nearly all other countries have tax systems where the VAT/GST/Sales tax is already included in the sticker price, so you don't need to know which country has how much sales tax and manually add it on. Additionally lots of other countries have income tax systems where the authority already has all your information and can easily provide you a pre-filled tax return.
Given that the USA does not do these things and people actively block them, then my opinion is that the country as a whole has a hatred of making tax easier to pay. Most people may not want that, but they are either unwilling or unable to change it.
NOPE! That's the misinformation. They don't want to make it harder to tax, they want to make it harder for the gov to add taxes. That's it.
> In addition you need to manually calculate the sales tax for every different county in the USA on top of the sticker price. It has been suggested that this is enshrined in law and/or done by the stores themselves, but the net effect is that this sales tax is at the forefront of people's minds when going shopping.
It is enshrined in law in some states, not all. And again the reasoning is so that tax cannot be hidden. Not to make it more difficult.
> Nearly all other countries have tax systems where the VAT/GST/Sales tax is already included in the sticker price, so you don't need to know which country has how much sales tax and manually add it on. Additionally lots of other countries have income tax systems where the authority already has all your information and can easily provide you a pre-filled tax return.
I'll need some evidence of this, as this is not my experience having traveled to many different countries. Some do, not most.
> Given that the USA does not do these things and people actively block them, then my opinion is that the country as a whole has a hatred of making tax easier to pay. Most people may not want that, but they are either unwilling or unable to change it.
Again NOPE. It's a hatred of ever increasing taxes. The gov must prove it needs the money, not just have their hands in our checkbooks whenever they're dry.
So ultimately you have a different view on taxation, and that's fine. What's not fine is lying about why the other side is doing it. This is where that divide is coming from.
In the EU it's illegal to show prices ex VAT (or other components that might make up the final selling price) to non-business/commercial consumers.
In places where including VAT/GST/BTW/whatever is normal, shops (usually targetting resellers or contractors etc) where a significant amount of people don't have to pay the tax, I think generally both prices are listed and it's required to be very clear about what's going on.
Where I live (Poland), prices on shelves are displayed in full (more than that, there's the price you'll pay for an item and price per unit of mass/volume, to enable comparisons), but on the receipt, there's always a per-product sales tax summary printed. So if I cared about sales tax revisions, I could easily notice it on the receipt. But most of the time, I just learn about revisions from a news article.
Yes, same packet of potato chips costs R20 at capital R25 at hill stations (but its MRP shows R25).
Oblig: sales/retail taxes in the US vary city-by-city. While just like the rest of the world: US companies put their MSRP on products - but it would be unfair to expect retailers to charge the MSRP and eat the tax themselves because some areas have zero sales tax but others have a 10% tax. That's bigger than the profit-margin on many items sold at retail - and the simplest solution is just to have everything understand that the price on a box is the pre-local-tax price. And everyone (most people? or just most people on HN...) know roughly what their local sales tax rates are anyway (mine's around 9%) and as everyone pays by card having exact change isn't an issue.
I disagree. If you want to sell something to a market then you should tailor your product to that market. That means doing some basic research about what the local taxes and laws are.
Ideally, the seller should list the price + tax if it is physically sold in a store. This should be fixed (along with the tips culture in US).
Online retailers still have this problem. Sales tax is literally based on the zip code you enter during the checkout page.
So how can this problem be solved? The only solution I see is a federally controlled fixed sales tax similar to EU. But, that would be unconstitutional in US. States hold the power and additional municipal taxes are at the county level.
I think you're trivializing the matter. I've had several conversations with Europeans about it and we eventually come to an understanding that its not easy. On surface, it sounds simple if we assume is a simple nation-wide VAT tax.
Living in couple of countries In EU and Asia, I can't imagine not knowing total price up front. It's pushing legislation problems on the end customer.
So, now, you have a new problem. Top counties with lowest sales tax in the US will massively attract more businesses forcing the rest of the counties to reduce their sales tax too.
The entire problem boils down to federal vs. local control. US is structured with a balance between local, state and federal powers.
The online retail problem is also trivially solved. If I got to the US version of any online shop as a EU resident I'm usually first greeted by a "which version do you want to browse" popup asking me if I really want the US version and not a different country. This affects the default language, currency and locale as well as pricing. There's no reason they couldn't ask for your zip code if they already have to do these calculations at checkout anyway.
The problem is that there's no reason US companies should do this because there's no competitive advantage in having transparent pricing. This would require legislation (probably at the federal level) but once there's regulations, you'd see these solutions pop up everywhere overnight.
It's funny to hear Americans lament about how it's hard to do business in the EU because of the many differences between countries and then turn around and use state or county differences as an excuse why it's "just too hard" to do what companies are doing in the EU. At this point I wonder if Californians are seeing the same "sorry, we can't figure out how to show you this website without harvesting your data" error pages on US news sites given how strict their new privacy laws are.
If the former, I already said:
> Ideally, the seller should list the price + tax if it is physically sold in a store. This should be fixed (along with the tips culture in US).
Can't you ask the zip code before checkout, a popup like "If you want to see the real price enter the zip code now"
On the physical store don't you have in US prices printed on paper stickers? Are prices printed on the bottles and boxes and all stores will have the exact same prices? So if this is something you never seen in US let me explain how is done, some products have a recommended price printed on them but shops can put their own larger or smaller price. You will see also labels with full prices s tricked through and discounted prices printed under.
I also seen shops rotating the prices daily, like if they have 2 products A and B , you have prices like
Monday A: 10$, B:20$ Tu: A:11 , B:19 We: A:12 , B:18
so on, I am surprised that the US does not use this scummy price rotating tactics. The "scam" is that the shop will put an ad on radio and say "bananas only X$" , next day the ad will say "milk only Y$" , and each time you will hear the ad you think "this shop has cheap products, I should buy from there" but when you visit the banana will be cheap but in that day mil is expensive, 3 days later will be reversed.
It's about consumer protection. Buyers must know exactly how much they will need to pay to purchase an item BEFORE they pay. It would be unfair to expect consumers to calculate these things.
Not correct. The price on the 'Box' is the invitation to treat [0]. The price you pay in the UK is the verbal Offer at the checkout. They may/should sell it a the RRP, but it is not correct in law.
When items get individual prices, they are usually small sticker prices and effectively only in small shops or discount prices in bigger stores.
Maybe it's just not become an issue since the MSRP on most product packaging here is in £ or $ as they just reuse the UK or sometimes US packaging so it's clear that price is not aimed at Irish consumers.