I don’t think anyone’s sales tax is 20% (for most things). I think ours (city of Seattle) is one of the higher ones and it’s only 10.25% (for most things - certain things are higher (e.g., liquor. The sales tax for liquor here is some magic number that I think they just make up at the register.))
If you grew up with the system, you know how it works and you’ve internalized which things are taxed and which aren’t and approximately how much more things cost than the price on the sticker. If it’s something that you buy all the time, you know exactly how much it’s going to cost - until they change either the price or the tax.
It’s not a rough estimate, it’s quite precise. But depending on your ability to do mental math and the tax rate(s) in the jurisdiction, it might be easier to do a rough estimate if you have that liberty in your finances. If you are on a very tight budget - you do the math.
((ETA - in many jurisdictions, groceries aren’t taxed. Which is helpful for very tight budgets))
If you grow up knowing that sales tax on groceries is, say, 7% where you live, you mentally add that. Roughly. People will also get to the register and have the cashier remove an item from the shopping. And lots of people will simply shop frugally enough that they calculate well below with the tax. So you have $10. You grab the bread for $1.79 and the peanut butter for $3.99 and 3 apples for $2.99 and you’re done.
20%!? This is why I don’t understand people saying they’d rather have VAT here in the US. That’s more than double the sales tax here! It’s way more expensive. Where I am in New York sales tax is 8.875%, so you basically just estimate 10% and know it’ll actually be a bit less.
I can remember when sales tax was included in pricing in Canada. But then it changed. It was mostly because, at the time, prices for goods and services were very stable, over lengthy periods of time.
But the government, having instituted the sales tax, of course, started low. But once established, they then drove it up in a relatively short period of time. Retailers hated having to raise prices and listen to people bitch, so they decided to separate them out.
So the consumer could clearly see it was the government driving the price changes they were seeing. And, in some ways it proved simpler to change the per cent the register adds, than to reprice every item in the store.
That’s how we got where we are. And now we’re all just used to it. Sales tax or VAT, included in the price, or not, everybody has still gotta pay, I figure.
Right, but upthread when some were arguing that including sales tax would be a hassle, let’s note that right now there’s a hassle, it’s just that it’s on the consumer.
Not sure if you’re being serious, but it varies from country to country and doesn’t need to be any arbitrary value.
The US is fine to stay as a low tax, poor social security country
Actually, forever stamps were introduced in the US after they were already common in some other countries. I remember seeing an OpEd in the New York Times from a member of the Postal Rate Commission suggesting the idea be adopted in the US.
Although I’ve seen people have the cashier take something out of the pile of things that the cashier has already rung up, at which point the cashier subtracts that item by pushing a button on the cash register, I suspect that it rarely has anything to do forgetting to include sales tax. A lot of people pay for their items with credit or debit cards with enough money on those cards that a purchase at a grocery store is unlikely to go over their limits. Among the ones who pay with cash, most of them can make an approximate estimate of the total including sales tax. How often do most people buying more than four or five items know precisely how much their total is, with or without sales tax? The people who have the cashier remove an item from their purchases are ones who either don’t carry credit or debit cards and forgot to bring enough cash that day or they are the people who honestly just barely have enough money to feed themselves or their families on. The fact that they have to add an amount for sales tax isn’t usually important.
Well, it’s zero on most food, books, children’s clothes and shoes, postage stamps and a couple of other things. So it doesn’t actually come up in your daily shop.
FWIW businesses using goods and services for their business don’t have to pay VAT on them (because the customer will, so if the business does too the tax is paid twice). There are a few shops that sell VAT-free if you can prove you are the VAT-registered owner of a business.
I think it’s understandable that the US doesn’t include tax, but it’s also a shame - it is genuinely helpful to know the whole cost upfront.
I’m trying to think of something I’ve seen in the US that I’d like to see replicated in the UK, but I’m drawing a blank. But I’ve really enjoyed my visits there so there must be at least a few things I just can’t think of right now.
Driving lessons as (an optional?) part of the school curriculum - if they still exist - could be one. Driving lessons here are very expensive and it’s not always that easy to find someone to give you informal lessons. It can be a real barrier to employment in some areas of the country.
I think that there is some problem with economic sanctions or currency restrictions, that discourages Air Canada from collecting the tax and remitting it to Venezuela in the normal fashion.
Some stupidly convoluted rules in Ontario at least, probably due to lobby groups.
For example, groceries are untaxed. Fast food under $4 total is taxed only federally.
If I go into McDonalds and buy a $2 cheeseburger, it’s taxed at 5%. If I buy two cheeseburgers and fries for $6, I lose the exemption and I’m now taxed on the whole amount at 13%.
What do I put on the price board for a cheeseburger? $2, $2.10, or $2.26?
A whole cooked chicken at the grocery store has no tax. Buy a 1/4 chicken dinner and it’s 13%.
You really can’t see the difference? When sales taxes (“taxes” plural – there may be more than one in some jurisdictions, further complicating the problem) are added at checkout time, the process is entirely electronic, automated, and jurisdiction-specific. When prices are supposed to include all sales taxes, you run into problems with nationally advertised prices, you run into problems with print ads, you run into problems with national and global websites, you run into problems with physically printed and posted prices, and on and on. A few of these problems are amenable to potential solutions, such as electronic price signs in stores (although this may be expensive and out of reach for smaller retailers), but the fact that different tax structures make prices different in different regions of a country, further complicated by the fact that exemptions are different in different regions, make the problem virtually impossible to solve.
Of course it’s theoretically possible to imagine a sales tax regime where integration into the basic price is possible – the VAT in the UK is just that. The point, however, is that in places like Canada this would require a complete overhaul of provincial/federal jurisdictional responsibilities in ways that would not only be very sweeping and fundamental, but actually unconstitutional.
Actually that’s pretty similar to what it is here (New York City.) All clothing & shoes under $110 are not taxed, and neither is most food in grocery stores, other than a few exceptions including sandwiches & sodas.
This is why I don’t understand people saying they’d rather have VAT here in the US. That’s more than double the sales tax here! It’s way more expensive. Where I am in New York sales tax is 8.875%, so you basically just estimate 10% and know it’ll actually be a bit less.
