My American Brethren! Can you explain this to me?

[XJ-0461]

The whole "sales tax" thing. When buying stuff, it says one price when you see it on the self, right? But then when you take it to the cashier, it adds like 7% of the price to whatever you're buying, yeah? How does that make sense? My reasoning for asking this is that I'm going to Hollywood for a holiday next year, and I don't want to get caught out when I try to buy something.

So I'm asking any Americans reading this, why do shops in your country do that? Is there some legal reason why it happens? Do all shops do that over there? And for other people not from America, does this happen in your counrty, or does it make any sense to you? It's something I can't get my head around on my own.

EDIT: To clarify, what I'm basically asking is why can't American shops include VAT (or thier equivalent) in their prices?

 

[nunqual]

So the government can get money? It's pretty simple to me. And it's not in all states, some don't have it, I think Pennsylvania doesn't have it, but that might be food tax.

 

[delet]

Taxes. There's a little bit added to the cost of everything. Yeah, it'd probably make more sense if they just included tax into the full price you see, but then that'd require a little more math.

 

[TheYellowCellPhone]

So the government can get money? It's pretty simple to me.

Um. Yeah. That, really.

 

[Palademon]

You mean VAT? Yh, we had that in England >>

 

[Chechosaurus]

It's just VAT basically but they don't add it to the display price.

 

[Deathkingo]

Oh yeah, sure. The government claims that it is for the good of the people, the sales tax. Yet, we all know the dark-seeded truth that they are really using it to build a robot army to march across the land that...you know, fix our roads, and pick up litter and stuff.

 

[Scout Tactical]

The whole "sales tax" thing. When buying stuff, it says one price when you see it on the self, right? But then when you take it to the cashier, it adds like 7% of the price to whatever you're buying, yeah? How does that make sense? My reasoning for asking this is that I'm going to Hollywood for a holiday next year, and I don't want to get caught out when I try to buy something.

So I'm asking any Americans reading this, why do shops in your country do that? Is there some legal reason why it happens? Do all shops do that over there? And for other people not from America, does this happen in your counrty, or does it make any sense to you? It's something I can't get my head around on my own.

There's actually a very clear and simple reason for this. It's a type of advertising. You'll notice that in America most prices aren't 2.00, but instead 1.99. This subliminally encourages people to buy the product, even though with tax it is probably closer to 2.07. People see the one in front and are more likely to buy. Not by much, mind you, but likely enough that almost all stores in America are willing to throw away a penny on every product.

 

[Glademaster_v1legacy]

The whole "sales tax" thing. When buying stuff, it says one price when you see it on the self, right? But then when you take it to the cashier, it adds like 7% of the price to whatever you're buying, yeah? How does that make sense? My reasoning for asking this is that I'm going to Hollywood for a holiday next year, and I don't want to get caught out when I try to buy something.

So I'm asking any Americans reading this, why do shops in your country do that? Is there some legal reason why it happens? Do all shops do that over there? And for other people not from America, does this happen in your counrty, or does it make any sense to you? It's something I can't get my head around on my own.

Basically I know this from Business Studies in school but in American they don't add Vat to the price tag. That is the best way to explain it really. They have the percentage on the tag(as far as I remember) but not the actual figure. While in Ireland, Uk and etc we add the Vat to the price tag.

 

[Buzz Killington_v1legacy]

So I'm asking any Americans reading this, why do shops in your country do that? Is there some legal reason why it happens?

I'm going to recycle a post I made on the subject a while back:

The way I always understood it was that it's a function of the way sales tax works in the US. Instead of a national VAT like the UK has, sales tax can be set all the way down to the city/town level. There are parts of the the US where you can drive for twenty minutes and be paying several fewer percentage points in sales tax.

Updating all the price labels in all the locations for a chain like, say, Best Buy would be prohibitively expensive, so they just put the retail price on everything and add tax at the register.

(I personally prefer the way the UK does it--it's a lot easier to shop when you're short on money and know exactly how much everything's going to cost.)

 

[RandomWords]

Its a tax, it goes to the government. Its just another way for the government to get a little more money to do things with. It would be nice if I didn't have to pay them but what can you do? Oh its multiplied by .007 and added to the total.

 

[ShadowStar42]

I guess since we all grew up with it we just don't think about it. Basically they don't list sales tax on the regular shelf price because a) it looks better to have lower prices on the shelves and b) some packaging includes prices and taxes aren't consistent so it prevents seeming contradictions. Just so you know though, sales tax in Hollywood is 9.75%, so you'll probably just want to add 10% to anything you want to buy.

 

[nunqual]

Its a tax, it goes to the government. Its just another way for the government to get a little more money to do things with. It would be nice if I didn't have to pay them but what can you do? Oh its multiplied by .007 and added to the total.

Actually it's multiplied by 0.07. Sorry, math nazi.

 

[ma55ter_fett]

Its just sales tax, the sticker price is what the store keeps, the 7% extra goes to the goverment.

food, cloths, something else are exempt though.

 

[Drakane]

Its not a VAT, assuming that is value added tax, as that is added to the overall price of the item at each stage. Not all states have it, such as Wyoming. But in general, I guess they leave it out for 2 reasons: It shows what portion of what your buying goes to the gov. and on bigger ticket items, the "sticker" price would increase to an extent that some buyers aren't going to buy it. Yes we all know its coming but buying a $1,999 tv is more acceptable then the 2300 or w/e it would end up being. Another reason for having it is, it makes tourists and passer bys of the state help fund some of its works such as road work. On the other hand states that don't have it, most of this work is shouldered by the people that live in state in increased property tax and the such.

 

[Robby Foxfur]

Its basically a massive way for the government to gain of people spending money that they already taxed with other taxes. sales tax varies from state to state, I'm pretty sure Delaware is the only state without 1.

 

[HT_Black]

"No, says the man in Washington; it belongs to the government!"

Pretty much that.

 

[similar.squirrel]

What? That 7% isn't counted? Over here, we have VAT [Value Added Tax] that's counted in the retail price. Are you telling me that Americans have to calculate 7% of anything they wish to purchase?

I assume it goes to the government, by the way.