Why are prices published without tax in the US?

Question

On a recent trip to San Francisco it was always a surprise to see what to pay in stores. It was never as simple as just adding all the published prices. There was always the addition of taxes. Sometimes it was just an additional 50ct, but sometimes the increase in price was substantial. The most extreme case being a bag of apples with a advertised price of 1.99 but a final price of 4.50. Isn't there a single VAT and how can I know the price to expect? If the taxes apply to everyone, why not simply publish the price including taxes?

Tax will never double the price of an item. Most likely the apples were 1.99 per pound, and you bought a 2+ pound bag of them. Most food like apples would actually be tax free. — Doc, Oct 27 '13 at 09:14
This isn't specific to San Francisco. This is basically the way prices work everywhere in the USA. — Fake Name, Oct 27 '13 at 09:39
@FakeName And in Canada as well, where the VAT percentage is different per province — Bernhard, Oct 27 '13 at 11:19
In Canada, I think tradition/influence from the US plays a role as well. Having a price per province does not seem like a big deal and taxes could easily be included. Eurozone countries are sometimes smaller than a Canadian province, have different VAT rates and yet taxes are always included in prices. Also, some products have just one retail price in several countries, which means the retailers actually set different before-tax prices so that the apparent price is the same and “absorb” the difference. All this is perfectly doable if the law made it mandatory. — Relaxed, Oct 27 '13 at 13:24
I was amazed by this as well when visiting the USA. In Europe, the price is not printed on the product (because of course, it may be more expensive in some stores than in others), but at the shelf. In the computer age, there is no reason whatsoever why each store can't label the actual customer prices on the shelf. They don't do it because it's legal not to do it. — gerrit, Oct 27 '13 at 20:03
In Switzerland, the price is always on the product itself (either printed or with a sticker), even for fast-moving consumer goods in supermarkets. — Relaxed, Oct 27 '13 at 23:42
Almost certainly your bag of applies was $1.99 PER POUND. The bag weighed a little over 2 lbs, plus ~8% tax brings you to $4.50. — Doc, Dec 17 '15 at 23:54
There is no sales tax on uncooked food in California (nor most other parts of the USA). I agree that this was almost certainly a per-pound price. — Andrew Lazarus, Dec 18 '15 at 23:23
I saw this question a while ago when it was first posted, but only just today realized that this might make a great question on law.se — Sean, Dec 06 '16 at 14:29
Jaayysus, here in Australia publishes and printed prices always include all taxes and are what the customer pays. I find it so backwards and plain misleading for the US to advertise prices that are often far off what you get on the bill. There is ZERO advantage to this. — VH-NZZ, Nov 18 '19 at 01:31

score 36 · Accepted Answer · edited Oct 28 '13 at 00:06

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There is no general VAT in the US but various sales taxes, which means that there isn't a single tax rate that shops could easily include in all prices. Depending on the location, there could be a sales tax from the state, county, city or even other institutions (transport authorities, etc.) so you cannot even set a price and print labels for a state or a metropolitan area, let alone nationwide.

Also, displaying lower prices is generally advantageous so as long as they don't have to do it, it would seem retailers have very little incentive to figure a way to deal with all this. Even if one would consider doing it (which is not the case as far as I know), they would just make themselves look bad compared to the competition. To use an analogy, even when several parties really wish to reduce their weapon stockpiles, it's too risky for one of them to disarm unilaterally and find itself alone without weapons when the others still have them (or in this case, display higher after-tax prices when everybody else advertises with before-tax prices).

edited Oct 28 '13 at 00:06

Flimzy

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answered Oct 27 '13 at 08:58

Relaxed

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Ah, comparing apples and guns :) – Bernhard Oct 27 '13 at 11:21
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Great answer, if you could add info on how to calculate the tax to be expected for SF I Will except this answer. – Oct 27 '13 at 11:30
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San Francisco sales tax is 8.75%; but the rate varies from one town to the next (ex nearby Berkley and San Mateo are 9.0 and 9.25% respectively). Some items, including Unprepared food, bakery items, and hot beverages, are exempt from sales tax. http://www.boe.ca.gov/cgi-bin/rates.cgi?LETTER=S&LIST=CITY – Dan Is Fiddling By Firelight Oct 27 '13 at 13:12
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so you cannot even set a price and print labels for a state or a metropolitan area, let alone nationwide Don't they have computers? Surely it would be easy to display different prices in different stores? If it's known at checkout, it should be known at the shelves of the store or — at least — using some kind of in-store portable scanner. I rather think the reason is your second point: if retailers can advertise a price lower than the real one, they'll do so. Plenty of products in i.e. Sweden cost more in one store than in another, simply because the other store is more remote. – gerrit Oct 27 '13 at 19:59
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@gerrit That's not so simple, clothes often have labels with prices for all shops, supermarkets advertise specific prices in ads, leaflets, on the radio, etc. All this would still be extremely complicated in the US, even with computers. – Relaxed Oct 27 '13 at 23:41
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One thing not noted here. As an American, I want to see prices without tax, for the simple reason that when I do get the bill I can get annoyed that the taxes are too high and be motivated to complain about it to my representatives. – Michael Hampton Oct 28 '13 at 01:17
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@MichaelHampton Don't worry, people manage to complain about taxes everywhere. In any case, it's easy to show both (it's the case in cash-and-carry shops in Europe because businesses don't pay the VAT) and the price without tax is generally printed on the receipt even in countries where the full prices is displayed in the shelves. Also: your taxes are too low. – Relaxed Oct 28 '13 at 01:30
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@Annoyed And I always thought the reason prices were printed inclusive of VAT in Europe was that the VAT was too high! – Michael Hampton Oct 28 '13 at 01:32
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Aren't taxes always to high, no matter the percentage ;) – Oct 28 '13 at 01:35
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@Annoyed I suppose the difference is that in the US, products have prices printed on them. That's not the case in Europe — instead, stickers are printed and attached to the products. And are taxes really the only reason prices differ? Isn't the base prices already higher for supermarkets in expensive locations, or in locations with higher minimum wages, or in very remote locations? Or are base prices uniform? That seems very... socialist? – gerrit Oct 28 '13 at 10:48
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My own currency is Euro as most of you and to make abstraction of taxes in US/Canada, I just read the tags as if they are in euro. This is very approximate, but if you consider the exchange rate being between 1.25 and 1.33 and the tax rate being 10 to 15% (so 1.1 to 1.15), you have a very rough comparison but very easy to calculate (easier than tagged price*1.1/1.3 +- 10% depending on non-displayed factors - I know food is very little taxed for example). – Vince Oct 28 '13 at 12:43
@gerrit Again, it's not true for all of Europe, see my other comment on Switzerland. Regarding prices, there are many techniques to practice price discrimination. I don't know if big distributors set different prices under the same brand in different locales but the problem in the US is that we are talking about different taxes in the same market/metro area, not remote resorts or different states. – Relaxed Oct 29 '13 at 10:18
@gerrit I have seen prices differ at two different grocery stores of the same chain in the same city separated by two kilometers or so. The difference was that the store in the lower-income neighborhood had higher prices for many items. Both stores have since closed, run out of town by a competitor who opened several stores with cheaper prices across the board. And we have no general sales tax. – Michael Hampton Jul 31 '14 at 01:15
You can cross a municipal boundary within a US state and pay tax at a different rate at another store in the same chain. Usually it isn't much different (something like 0.25%) but it may be noticeable if you're buying something big. – Spehro Pefhany Apr 30 '15 at 18:04
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Some places in the US do traditionally include sales tax in sticker prices; for instance, at a ballpark prices normally include all tax. Generally when they do this there's a sign, and often it's in situations where you aren't likely to go to a competitor with a lower sticker price. – cpast Apr 30 '15 at 19:01
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Umm so all stores print their labels in ONE place and ship around the US? If they are printed at the store then the store knows the final price. Print that. Problem solved -.- – Maciej Swic Feb 29 '16 at 13:55
@MaciejSwic Or introduce a federal VAT or… only it's never as simple as that so what's the point? – Relaxed Mar 01 '16 at 17:59
Concession stands at stadiums and similar places often include the tax on the sign so they can have round final prices and avoid making change (or make change with only quarters). – Zach Lipton Mar 01 '16 at 19:11
@ZachLipton and some stores -- mostly I've seen this in restaurants -- now have cash registers that will include a "rounding" item on the receipt for the same reason. – phoog Mar 01 '16 at 19:45
It should also be noted that online stores also maintain the practice of not showing you the final price before you checkout, even if you're logged in and they have your shipping address on file. Unlike physical stores they can easily pre-compute everything in advance, but they still prefer to cheat you a little bit. – JonathanReez Jan 29 '18 at 05:56
This answer doesn't make any sense. – Robo Robok Feb 05 '20 at 15:52
@RoboRobok Is it entirely devoid of meaning, obviously absurd or merely incorrect? – Relaxed Feb 15 '20 at 18:26
The part about being unable to print labels is absurd. USA is obvious case of anti-consumer country on many fields, there is no other reasoning. In Europe you always see the price as it is, even though European countries are of the size of American states. – Robo Robok Feb 18 '20 at 05:42
@RoboRobok What I explained is that tax rates are not unified at the state level but can also vary at the county and city level. But I don't disagree that there is also a good dose of business lobbying in favor of the status quo, I also wrote that in the answer. – Relaxed Feb 19 '20 at 20:33
Even if the tax was limited to one particular store, it still doesn't justify the lack of tax info. – Robo Robok Feb 19 '20 at 21:57
@RoboRobok I don't know if anything would “justify” it in your eyes and I certainly do not think it makes the problem completely intractable, I am just explaining that you cannot print a single set of price tags, even for a single state. That's not absurd, that's not even debatable, it's a simple fact (which you seemed to have missed when you originally passed judgment on my answer). – Relaxed Feb 20 '20 at 19:29
So what? What does it change that you're not able to print them for a single state? You know the final price for a particular store, you print it for that store. Simple. Plus, many stores these days show prices on screens. What is their problem with showing the final price? – Robo Robok Feb 20 '20 at 20:48
@RoboRobok I never claimed anything else than this simple fact: “you cannot even set a price and print labels for a state or a metropolitan area, let alone nationwide.” You claimed my answer did not make any sense and drew a comparison with European countries that suggested you assumed price would only differ from state to state and not from city to city. If we agree that this is not the case, I have to assume my answer now does make sense to you. – Relaxed Feb 20 '20 at 21:54
No, it doesn't. You apply the reasoning that has nothing to do with the actual problem. Your point would have made some sense if the tax changed every few days or so. Otherwise it's bullshit. – Robo Robok Feb 20 '20 at 22:34
@RoboRobok What reasoning now? – Relaxed Feb 21 '20 at 13:51
Okay, you must be trolling. – Robo Robok Feb 21 '20 at 19:06
@RoboRobok Seriously? From someone whose comments contains such gems as “doesn't make any sense“, “absurd“ and “bullshit“ while misrepresenting my point and making sweeping statements about shops showing prices on screen and the like... – Relaxed Feb 22 '20 at 07:28
Also taxes change during the year. In New Mexico the state can change the Gross Receipts Tax every six months. Also the county and city can change their tax rate at random times. It would take a lot of effort of constantly change the price, also as others have said it makes the price look lower. – gamma_sponge Dec 02 '22 at 19:34

score 24 · Answer 2 · answered Oct 03 '14 at 13:03

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I would say that because the law is not on the consumer side in the USA and therefore does not require the total price to be displayed.

Most shops will therefore leave off taxes etc as you are then more likely to buy an item. (Trustworthily companies loose trade due to other companies misleading consumers on prices, so therefore quickly all the companies become as bad as each other.)

answered Oct 03 '14 at 13:03

Ian Ringrose

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I don't see how such a law would favor the consumer. There is very small gain from knowing the exact item price, while the considerable cost of implementing this across many U.S. tax regimes would be passed on to the consumer. There's nothing deceptive about the practice as long as it is clear that tax is not included. Requiring tax to be included in prices favors government more than anyone, since you notice the amount of tax you are paying far less. – Aug 10 '16 at 15:35
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@dan1111: This sounds like you have become so used to the practice, you don't see how it hurts you. There is a consumer gain to knowing the exact item price. For example, I can ready my exact change while waiting in the queue, except in regions in the USA. The costs of implementing this are already born by the shopkeeper at the till - the question is merely what the price tag says. – Oddthinking Aug 30 '16 at 02:24
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@Oddthinking I have experienced both systems, having lived for a number of years in Britain. Being able to get your exact change ready is what I meant by "very small gain". That doesn't come close to justifying the significant implementation cost this would have in the USA, in my opinion. – Aug 30 '16 at 06:26
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"The costs of implementing this are already born by the shopkeeper at the till" - no. It's easy to make the final price at the till reflect the local tax jurisdiction. It would be much harder to make store-wide pricing labels, plus things like websites, flyers, and items with the price pre-printed on them, vary appropriately so that they show the full price including tax in each different locale. – Aug 31 '16 at 11:44
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it's mandatory in europe and no store has died for spending 20 dollars on a new ticketing machine paper roll, the "llittle gain" argument is obnoxious. with mandatory final price tag, you can't be scammed, lied, or pursued to purchase a product you later can find to be a dollar, or 100 dollars ( car, telelevision, furniture ...) more expensive than that other store that was just 5$ more expensive, but where those were the final prices. – CptEric Oct 04 '16 at 12:52
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@CptEric Also (like we do in The Netherlands, I don't know about other countries) the name on the price tag can be leading/definite by law. If the cash register says something else (higher), the price you have to pay is the one on the price tag (unless it's obvious a mistake was made). Consumer protection. – Dec 06 '16 at 09:10
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The "cost of implementing this across many U.S. tax regimes" is not considerable. Numerous large chains already run software that works in all their stores by inputting the tax amount specific to each store. In my opinion, it's just a dishonest practice that is not done in most of the thirty other countries I've visited. But then I'm probably wrong. Obviously USA is smarter than all those other places that can't handle miles/feet/inches, pounds/ounces, gallons/quarts/cups, or Fahrenheit. – WGroleau Nov 29 '22 at 01:26

score 8 · Answer 3 · answered Apr 30 '15 at 17:36

One of the reasons this is done by sellers is so that consumers know who to blame for the prices they are paying. In particular, the seller wants the consumer to know that it is not the seller's fault that the product costs 10% more than it needs to (or whatever the rate is). Thus, the seller lists how much of the total price is attributable to sales tax so that the consumer knows that at least that portion of the price is attributable to the government. This is explained in greater detail below.

Sales taxes (and VATs) are levied on sellers, not on consumers. However, if the seller is going to have to pay a tax for selling you the product, they are going to have to charge more for the product in order to offset this additional cost to them. Specifically, if the tax costs the seller $X, then the seller is going to have to increase the price of the product by $X in order to break even. However, recognizing that consumers are price-sensitive and that they will not be happy about paying $X more for the product, the seller wishes to direct this consumer angst away from themselves. In essence, the seller is trying to protect themselves from the backlash resulting from the higher price by pointing out that they are not the reason for the higher price, the government is the reason.

In furtherance of the goal of directing consumer angst away from themselves and toward the government, the seller advertises the "pre-tax" price. This communicates to the consumer how much the seller would have been willing to sell the product for if only they didn't have to pay that darned tax.

Of course, the above-explains why the seller wants to list separately the pre-tax price and the amount attributable to tax, but it doesn't explain why the seller does not also list the post-tax price in addition to the other information. This, I assume, is done because the sellers believe that listing the higher price will have a negative effect on buying decisions. Sellers believe that consumers are affected emotionally by the listed prices, even when the consumer knows logically what the ultimate price will be. In particular, sellers believe that, even if a consumer logically knows that the ultimate price will be $Y, they will be more emotionally inclined to purchase the product if what they see on the label is less than $Y. The theory is that at least part of the emotional reaction of the consumer is tied to the price as seen, even when the consumer knows that price will increase at checkout. This is the same reason sellers prefer the ".99" format (i.e., $9.99 is preferred to $10.00), because they believe a buyer who sees $9.99 will be more emotionally receptive than one who sees $10.00, even though logically the prices are essentially the same. Thus, if listing the total (tax included) price makes consumers less emotionally receptive to the product, then sellers will be inclined to not list the total price if they can avoid it.

In addition, listing three pricing information items (base price, sales tax, total price) next to each product might not be desirable (or even feasible) in certain settings, such as limited space settings (e.g., menu board of a fast-food restaraunt). If there is only room for one priceing infomration item, then the seller is obviously going to favor the lower number.

This argument seems flimsy because it isn't applied to other costs that the seller must bear. They don't say "Apples are $1.99 plus sale tax plus bank transaction fee, wages, land tax, rent, etc." — Oddthinking, Aug 30 '16 at 02:20
@Oddthinking There's not much that can be done for transaction fees, wages, etc. Those things are settled by the market. Taxes though can easily be changed by passing a law, and a tax is not a market force, and something citizens can have some control over. — Andy, Dec 04 '16 at 22:28
@Oddthinking: Have you bought a plane ticket or booked a hotel room in the US? That's exactly what they do! ("Fuel fee," "airport fee," "resort fee" etc.) Convenience fees for concert tickets. Any time it's legal to hide the true price by using fees, that's exactly what happens. — Noah Snyder, Nov 23 '20 at 20:46
@NoahSnyder: That doesn't explain why apple price tags don't list multiple costs. It isn't less legal than concert tickets. — Oddthinking, Nov 23 '20 at 23:22
This argument fails to note how easy it is to state the amount of the tax on the receipt like many other countries do. As for taxes changing, that doesn't happen any more often than all those other fees. — WGroleau, Nov 29 '22 at 01:20

score 8 · Answer 4 · answered Aug 10 '16 at 14:55

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As pointed out by others, its the fact that consumer protections are weaker in the USA, and since consumers are now used to it, and do not realise that they are probably spending more than they probably would otherwise with full price, there is very little incentive to change.

The retailers have no incentive to change, since the complaints are from a minority of consumers, the government has also no incentive as full price would perhaps impact consumption negatively at first, and consumers do not have a loud voice on this as they are mostly accustomed to it.

answered Aug 10 '16 at 14:55

ANother

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-1 Explain how a consumer is harmed by not including the amount of tax in the list price. – Andy Dec 04 '16 at 22:29
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@Andy: if you have a fixed budget, you can't tell how many of item A you can buy. That's sort of the basic function of a printed price. How can consumers learn to spend responsibly if the actual amount they'll have to pay can only be guessed. – RemcoGerlich Dec 05 '16 at 08:47
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@RemcoGerlich It's amazing how many people judge from a distance. Its a non-issue here, since people are aware of the existence of the sales tax and typically know the exact percentage (it's not like the rates change from building to building). Where I live, the state sales tax is 6%, and in the city I live there's an additional 1% local option. If something $10 is taxed, I'll need $10.07 to buy it. Really not that hard. It seems to only be non-Americans that can't understand this, but if you live in the system and deal with it daily, its not a big deal at all; no guessing at all. – Andy Dec 06 '16 at 23:05
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@Andy: it's actually $10.70. – RemcoGerlich Dec 07 '16 at 08:23
But besides the snark value I got out of that comment, yeah it's obviously not dramatic. But the people who need to budget the most are also typically the people who don't understand these things well, and it is making it more difficult for consumers, no matter how slightly. – RemcoGerlich Dec 07 '16 at 08:25
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@RemcoGerlich I assume you'll forgive my typo on the price. At any rate, people that need to budget don't even typically have to worry about it, as grocery food, clothing and other necessities aren't typically even subject to sales taxes at all. Utility bills will always include taxes in the final amount, gas taxes are always built into the price like a VAT, etc. I think something like a heating bill would be more of an issue to a budget, given it will vary based on the temperatures that month. – Andy Dec 07 '16 at 23:28
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@Andy " It's amazing how many people judge from a distance". That's a cultural distance. There are strict European rules about price transparency so that "what is you read is what you pay for". As an European, I am not surprised about the criticism. – usr-local-ΕΨΗΕΛΩΝ Oct 12 '18 at 18:48
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A non-issue here. And a non-issue in all the other countries where the REAL price is announced. – WGroleau Nov 29 '22 at 01:23

score 4 · Answer 5 · answered Oct 03 '14 at 22:40

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First of all, there's hardly anywhere in the United States with a sales tax over 10% much less a rate of over 50%; you either misunderstood the price of your apples or were overcharged.

Retail sales tax in the US and Canada is inherently different than VAT (value added tax) charged many other places, sales tax is charged based on what the retail sale of a product vs. VAT accumulating through each stage of the production process.

While now easily surmountable, before computerization various local (city and county) sales taxes across the country posed a burden to retailers who operate in multiple places to calculate prices. Another reason for tax being is giving transparency as to how much tax governments are collecting.

answered Oct 03 '14 at 22:40

Carl

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VAT and before tax prices are mentioned on receipts everywhere in the EU. I am also not sure I understand what you mean with “accumulating through each stage of the production process” or how this would have any impact on prices posted in shops. – Relaxed Oct 03 '14 at 22:46
The VAT-break-down is listed on receipts many places, but customers don't always get receipts. – Carl Oct 03 '14 at 23:07
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Canadian HST is the same as VAT, but is not usually included in the ticketed price. Some ethnicities (Korean fast food retaurants for example) prefer to roll the HST into the price so you may pay what you see, or maybe not. – Spehro Pefhany Apr 30 '15 at 18:07
VAT accumulating through each stage of the production process.

B2B does not pay VAT as in is returned, since is Value Added Tax, only applicable to final product. VAT is only about the retail price. As a company, when you sell $1000 worth of merchandise and you spend $1000 to get that merchandise you actually pay $0 for the VAT, since you did not add any value.
– Coffeeholic Dec 08 '21 at 17:37

score 1 · Answer 6 · answered Oct 04 '16 at 00:04

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In most if not all states, the sales tax is levied on the total value* of the purchase, not on the individual items. For example, RCW 82.08.020:

(1) There is levied and collected a tax equal to six and five-tenths percent of the selling price on each retail sale in this state

Consider a purchase of a dozen $1 widgets with a sales tax of 8.6%: if the tax was per-item rather than per-purchase, you'd be paying $0.09 tax per item ($0.086, rounded to the nearest cent), for a total of $1.08. Computing the tax on the purchase instead gives you $12 * 0.086 = $1.03 in tax.

* Total taxable value. Food, for example, is frequently not subject to sales tax, so if you purchased bread, eggs, milk, napkins, and paper towels, the tax would only be computed for the total price of the napkins and paper towels.

answered Oct 04 '16 at 00:04

Mark

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Ten items at $0.10: $0.0086 rounded up to a penny tax on each for $0.10 tax vs. $0.086 rounded up to $0.09 on the purchase. Twenty items at $0.05: $0.0043 rounded down to $0.00 (per RCW 82.08.054) for no sales tax vs. $0.086 rounded up to $0.09 on the purchase. There's almost always a difference in rounding between per-item and per-invoice computations. – Mark Oct 04 '16 at 00:18
Okay cool; wasn’t sure and was too lazy to do the maths. By the way note that in Europe this doesn’t matter; the tax is levied from the salesperson by adding up all their sales of a specific tax rate at the end of a set period. The prices are simply quoted as prices including an imaginative (non-rounded) percentage of VAT. – Jan Oct 04 '16 at 00:21
Actually, re-reading your answer I misinterpreted it the first time. I thought you were assuming twelve items totalling in a dollar, but you had been assuming twelve items at a dollar each. So the first comment is moot anyway ;) Sorry for any confusion ^^ – Jan Oct 04 '16 at 00:22
In areas where multiple tax rates exist for different classes of items, you may still see a per-item tax calculated. I was surprised to see so many types of taxes from a receipt from a recent trip to a grocery store in Chicago. And if I remember correctly, the rounding is done by each store's policy, as the sales tax is actually levied on retailers and not consumers. Stores just pass it on down in whatever manner they see fit (total then round is least likely to cause arguments from their customers) – Kent Dec 05 '16 at 05:27
In the UK, a business has the choice to calculate VAT per item (according to rules set by law), or to calculate VAT for the complete bill (according to the same rule); the outcome will often be different due to rounding errors, and can be significantly different if you buy 100 very cheap items. The business can make that decision once. – gnasher729 Nov 30 '22 at 12:26

gnasher729 · Answer 7 · 2022-11-30T12:24:36.157

There is no particular reason why prices should be displayed exclusive or inclusive of sales tax. It's just traditionally done without tax in the USA, and with tax for example in Europe. In the end you pay the same amount.

It is obviously a nice surprise for US tourists in Europe (I thought it was expensive but it isn't), and a not so nice surprise for European tourists in the USA (I thought it was cheap but it isn't), but within a country people are used to it and are not tricked by it.

I bet nobody knows why it is that way. Some people come up with explanations after the fact, like how hard it is to display the amount including tax. Shops in European countries handle that without problem, so it is unlikely the real reason. What actually happens is that the marketing department sets the price that gets displayed, same everywhere, and in Europe the price without VAT is then changed to get the correct end result.

score -2 · Answer 8 · answered Dec 17 '15 at 21:35

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No-one has actually answered the question which is why don't American (and Canadian) stores show the true price on stock, i.e. the price that the buyer will pay including taxes, except to say that they don't have to, so they don't, or the more unbelievable response, taxes differ between states, counties and even cities so individual pricing is impossible.

Rubbish. Surely stock doesn't have the price pre-printed on it, that would be silly given that every place seems to have a different end price. Don't Americans have the technology of label guns which print the price (the full price) on a sticky label which is stuck on the product? Or shelf labels showing that full price? (Facetious question - of course they do - so why can't they use it?)

As for competition, if every store had to show the full price, then any competitive advantage would remain, shop A would still be cheaper than shop B by the same x%.

The fact remains that non Americans cannot understand why a simple procedure is so difficult. And the question remains, why aren't American shops honest about their prices?

answered Dec 17 '15 at 21:35

kiwi-ian

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They are honest about the prices. Nobody is trying to claim that you won't have to pay tax. – phoog Dec 17 '15 at 21:46
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It is just forever calculating in the shop how much the final price will be. In Europe (and most of the rest of the world) you see the price you have to part with, including tax. Much easier on the person shopping. – Willeke Dec 17 '15 at 21:48
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Sounds like a rant more than an answer. – Karlson Dec 17 '15 at 22:02
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How about catalogs? And TV advertising? Newspaper advertising? The in-store problem is relatively easy to solve, the rest are not. – Doc Dec 17 '15 at 23:55
The problem might be that regional and local taxes are added to the national ones, which makes that prices may differ between towns close together. In Europe we get around that by adding to the add where the location is where you buy the item for that price. It is often even illegal to advertise items for private use without showing all taxes. – Willeke Dec 18 '15 at 17:07
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@Willeke the US has no national sales tax. In jurisdictions like New York City where both the state and the city impose tax, this works out as a net sales tax rate rather than multiple tax amounts. I know that sales tax in NYC is 8.875% or thereabouts. I have no idea what the state sales tax rate is, however. – phoog Jun 19 '16 at 20:32
So it is adding local and state taxes to no national tax, which comes to the same. – Willeke Jun 19 '16 at 20:45
Some stock most certainly does have pre-printed prices. It is routine with books. – Andrew Lazarus Aug 10 '16 at 21:50
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it may not be expressed correctly, but as a foreigner going to a shop in the USA, it *feels* dishonest when you go to pay and the final price is not what you expect – mcmillab Oct 04 '16 at 01:31
@mcmillab Does it still feel dishonest if there's an unexpected discount at the register too? – Andy Dec 04 '16 at 22:53
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@Andy If it happened with every single purchase, yes. – Karu Feb 21 '17 at 00:29
Sometimes discounts are also dishonest. For example: "50% off!!" (of the price that we doubled at the same time we posted the discount). Or "50% off!! And an addition 10%!" which makes (most) people think it's 60% when it's really 55%. – WGroleau Nov 29 '22 at 01:33

Why are prices published without tax in the US?

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