So, implement sales tax like Europe does VAT and include it in on the shelf price, and make sure all shelf prices end in 0 or 5. Then, adding up items in a cart will also end in 0 or 5, and the tax is already included, so there is no math beyond the addition that could change the total to anything ending in something that is not 0 or 5. No matter how people pay, cash or card, the price will be the same, and it will always end in 0 or 5. As an added bonus, customers don't have to wonder how much tax they'll pay, because that's already included in the price.

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munk-a 7 hours ago | parent | next [-]

America is allergic to baked in taxes - you've got to keep the appearance of a deal even when there isn't one. America also embraces a lot of junk and hidden fees - ticketmaster is a great example of this.

I think consumers would love having baked in taxes and clear prices and were the government functional I'd hope that a consumer advocacy agency could enforce this - but that's simply not where we are right now.

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linguae 6 hours ago | parent [-]

Additionally, having baked-in taxes à la Japan would change how advertising works, since we don't have a uniform sales tax (unlike Japan). For example, I live in San Ramon, CA, which has a sales tax rate of 9.75%. If I drive just two miles north to Danville, the sales tax goes down to 8.75%. If I drive a few miles south to Dublin, the sales tax goes up to 10.25%. The reason is because California has a base statewide sales tax of 7.25% (with 1% of it going to local governments), and city and county governments are free to add up to 4% for local sales taxes.

By comparison, in Japan the consumption tax is 10% for most items (8% for groceries and takeout), and it's the same nationwide.

In addition, there are sometimes fees that are prohibited by law from being baked in. For example, California has a statewide ban on free "single-use" bags in grocery stores and some other businesses. These businesses are required to charge their customers for bags, and they are not allowed to bake it into the price. Some municipalities have extended this to disposable cups as part of an effort to discourage them in favor of reusable cups. For example, Santa Cruz mandates a 25 cent fee on disposable cups. The Costco $1.50 hot dog + drink combo is normally $1.50 + sales tax, but in Santa Cruz it's $1.50 + $.25 mandatory cup fee + sales tax (yes, the cup is taxable). I have yet to see someone bring a disposable cup to Costco or to other places where paper cups are sold, however.

Having baked-in taxes will require big changes about how taxes and fees work in America, the land of extra sales taxes, extra fees, surcharges, and tipping.

	▲	munk-a 6 hours ago \| parent [-]
		Some good news though - having baked in sales tax being required in advertising actually aligns marketing lobbying with pushing for harmonized sales taxes which I'd generally consider a more just system. IMO adding random regressive taxes in different counties to make up budget shortfalls causing very strange market effects is a bad thing.

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cratermoon 6 hours ago | parent | prev [-]

Penalizing the poor further?