UK, Euro and Canadian residents: VAT and sales tax question

Woolco used to include GST (but not PST!) in their prices just as store policy, which was often just baffling. Of course they don’t exist anymore, but they were a definite anomaly in this.

You’re correct that in Alberta, there is no PST. We pay only the GST.

That being said, I see no reason why both federal and provincial sales taxes cannot be rolled into the purchase price, in a “the price you see is the price you pay” scenario. Having been to the UK, Australia, and various European countries where “the price you see is the price you pay,” even though a VAT is included, I appreciate the lack of mental arithmetic involved in order to ensure that one can actually afford a purchase. On a $10 item, the Ontario retailer can display a $11.30 price, while the Albertan retailer can display a $10.50 price.

I’ve heard that one of the reasons for the “tax added at the point-of-purchase” is so that people know what’s extra and will complain to their elected representatives. But given that (in Ontario), sales tax has been around since the early 1960s, and the federal GST has been around since 1991; it seems to me that complaints haven’t worked and that sales tax isn’t going away any time soon.

Just roll it all into the “price you see is the price you pay” already!

Here are the VAT amounts for France, for regular customers:

As mentioned for other countries, the prices displayed are VAT-included, and, at least for supermarkets (because it’s been a while since I’ve bought something elsewhere), when you get the bill, you have the rundown of how much of what you paid goes to the VAT of 19,6% (the usual), VAT of 7% (reduced) or VAT of 5,5% (products seen as necessities or very commonly bought). (It’s described in full at the wikipedia page)

The only place I get amounts without VAT are when I go to my
auto mechanics. Each time he tells me a price, I assume it is without VAT (since he buys it like that), and have to ask him to quote me the full price, else I get surprises when I received the final quote.

I suppose the problem is that Walmart, for example, wants to display price tags that reflect the sale price, not the sale price after all taxes are considered. Therefore, the same items and tags can be shipped to Ontario or Alberta, etc. without adjusting the price tags. Why should it be the business of the retailer to care what the local tax rates are?

Same for me, when I’m shopping in Canada. And it means I buy less.

Since the thread’s been moved to IMHO, I guess it’s OK to comment on Thailand’s VAT.

VAT is never added at the register. All prices are net. If you buy a 100 baht shirt, your receipt will show 93.46 baht for the merchandise, 6.54 for the 7% VAT. (VAT can be recovered at the airport for goods you’re leaving the country with, though I’ve never done that.)

The only exception may be hotels which cater exclusively to upmarket foreigners. Their prices are often quoted as “+ +”. Exactly what that means I’m not sure, except that you’ll pay more than the listed prices.

I once hired a high-rated contractor for major work. When we discussed prices, he said it would depend on whether I wanted VAT receipts. :smack:

I’ve thought that net prices would be convenient in U.S. Impractical in California, I guess, since you can cross a street and leave the 34th Flood Control District, which subtracts 0.07% from your sales tax, while entering the 19th Sewage Zone, which adds 0.04% back! :smiley:

Nothing new here. A few years back I bought a replacement tempa-spare from a wrecking yard. The counter guy looked at it and grunted, “Ten, cash.” I asked for a receipt and he grunted, “Twenty, cash.” I paid ten and left him to his tax-dodging fate.

Yes, the poor, poor overworked retailer, whose B&M store does not move from tax district to tax district. It would be awful to ask them to consider something affecting prices that changes every five to ten years. :smiley:

When places like WalMart have realtime price updates on much of their stock…

GST was introduced in New Zealand in 1986 at 10%. All retail prices since then have included GST if it isn’t stated but may be shown as price + GST if the retailer wants to. Typically, computer hardware is shown as price + GST at specialist stores, not at those that sell other stuff as well. I’m not sure why that is, but it seems to be a countrywide practice.

GST was raised to 15% on 1 October 2010, so around the change, many prices were shown with both tax amounts meaning there were two inclusive prices on tickets. That’s about the only time many people would think about the included tax.

Or, perhaps sometimes when a retailer advertises “GST Free” which really just means they will give a 15% discount on the total.

As GST is a value added tax, middlemen will typically be able to claim for GST inputs when they process goods or services, i.e. buyer pays GST OF $15 on a widget selling for $115. Retailer has bought widget at $50 + GST of $7.50. When he does his GST return, the input GST ($7.50) is claimed back when he declares output GST of $15.00, so final tax content of widget is $15, not $22.50. Retailers and other resellers of goods (think motor mechanic and spare parts)will be quite aware of tax content of prices but retail purchasers not so much.

There is only one GST rate too, so that also helps people to just include the same rate of tax in all their pricing decisions.

The debate over the GST was pretty nasty in Canada. It was needed - the old system taxed manufacturers at the wholesale level, and local manufacturers claimed they were at a disadvantage compared to foreign competitors.

To shut up the opposition parties who claimed this was going to be a “hidden” tax, the government deliberately made the GST separate from the listed price.

Plus there’s the added complication of provincial taxes. If an Item is $10, GST (5%) is 50 cents, and PST (let’s say 8%) is 80 cents. If GST were rolled into the price, the PST would either be on $10.50 (taxing a tax) or the register would have to caluculate the pre-GST price of each item.

To complicate matters, many items are taxed differently. The GST was made as universal as possible, exempting only things like medical supplies, and food and rent. PST’s tend to exempt provincial favourites, like books and children’s clothes. An acquaintance in Ottawa once told me he was furniture shopping and the store told him “pick it up across the river in Hull and save a few dollars. Quebec doesn’t charge PST on furniture.”

The major difference though is the GST applies to services (the plumber, the lawn care guy, etc.) while PST’s are only starting the last decade or so to realize how much more money there is in this. The GST is sufficiently hated for this, that attempts to produce an HST (Harmonized Sales Tax) have cause political problems in several places and still has not universally happened. IIRC, BC tried to introduce it, then had a referendum and had to undo the change.

A PST is a sales tax on the end product, wholesalers etc. are exempt, while the GST is a VAT - everyone pays, but the manufacturer can deduct what he paid for the material from what he collects when remitting to the government, so effectively it taxes the value of the end product. My observation is that a VAT is a payroll and profit tax, as those are the two largest items on which there is not VAT for the middleman to reclaim.