It's illegal to put on the price the customer is actually going to pay? My search attempt failed ("illegal to put price with VAT" neither g nor ddg liked it), please tell me more!
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.
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[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.
Yes, same packet of potato chips costs R20 at capital R25 at hill stations (but its MRP shows R25).
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.
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.