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> Likely, it's just more of the media, talking heads, and youtube personalities trying to turn a nothing into something, story. It's not. Some US states have
by pwg 11mo ago
> Likely, it's just more of the media, talking heads, and youtube personalities trying to turn a nothing into something, story.
It's not. Some US states have laws on the books that make it illegal for retailers to round up. The turmoil is that if the retailer can only round down to the nearest five cents, then they stand to lose from one to four cents per cash sale for any sale that is not a multiple of five cents. Add those one to four cent losses up over a large enough number of transactions and the retailer stands to lose a considerable sum over the course of a year. And many retail shops already operate with thin margins anyway, so the loss from "always round down" could erase whatever thin margins some shops already operate under.
- IncreasePosts 11mo agoThey can add a "total not divisible by 5" fee, ranging from 1 to 4 cents
- gus_massa 11mo agoThe other direction avoids a lot of stupid complains. Nobody will complain if the shop gives them a $0.04 gift.
- chaboud 11mo agoThe shop will. It can be a lot of money in aggregate. It also creates really pathological purchasing incentives, where spreading out large purchases over several small purchases can yield significant savings for the purchaser. There's one exceedingly simple answer: Keep the penny (possibly a new one that is cheaper to make). We're basically breaking into jail on this one, creating more problems than we're solving.
- gus_massa 11mo agoHi from Argentina! Here we unofficially deprecated the AR$10, AR$20 and AR$50 bill, so the smallest one is the AR$100 bill (~US$0.07). Every price include taxes. What are they selling? Candies one by one? Inside the candy store everything is rounded to a multiple of AR$100. A single candy is AR$100. You many get an offer of 3 candies for AR$200, or 2 small candies for AR$100, or other fancy candies in packages of 13 for AR$1000. Everything else is more expensive, like AR$700 or more, but all multiples of AR$100. The photocopy shop near my home has a copy for AR$120. They usually sell many copies, so a 20% is relevant. They have a stash of AR$20, but it's probably the only shop nearby. I also collect the AR$20 just to pay the photocopies, just to be nice to avoid finishing their stash and also because I don't know what to do with the AR$20. I guess a single apple is probably a problem. It cost like AR$400-AR$500 depending on the weight. Someone very smart can learn to choose and apple with the exact weight to get a AR$499 apple and pay AR$400 :) Luckily inflation changes the price so it's difficult to learn. Also AR$499 will be illegaly rounded to AR$500. And most people will buy more than 1 apple, let's say that the total is AR$10,000 and AR$100 is only a 1% that is lower than the spoilage of rotten fruit.
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- philipallstar 11mo agoIf it means shops stop charging $4.99 and start charging $5.00, I will be ecstatic.
- bluGill 11mo agoProblem is it isn't just the $5.99 rounds to $6.00 it is tax. If the end cost is $6.36 will the state be happy with that one penny less? For any state 1 penny per transaction is millions of dollars per year! (note that I had to change your price from 4.99 to 5.99 - 5.00 times any tax rate is an even multiple of 5 and so cannot make the point).
- wasabi991011 11mo agoIn Canada, the rounding is done after tax, and only affects what the cash-paying customer or vendor receives. The sales tax amount is not affected.
- philipallstar 11mo agoIt seems crazy to even advertise the pre-tax price.
- bluGill 11mo agoThe tax is applies after the total is added up so there is no other choice When I was a kid a value meal at McDonalds was $3.18 after tax, but two of them was $6.37 - that extra penny over all the meals McDonalds sells in a state adds up to a lot of money and they were not going to let that go.
- philipallstar 11mo agoAs long as all the amounts when taxed add up to round numbers, you don't need pennies.
- rtkwe 11mo agoIf your shop can be wiped out by losing that little on each transaction it wasn't long for the world anyways... Retail margins are thin by industry preference but they're not 1-4 cents per transaction thin.
- bjourne 11mo agoEr... So just adjust prices to whole multiples of 5 cents? Helps math-challenged cashiers too...
- jcranmer 11mo agoPrices in the US are not tax-inclusive, so the effect of sales tax ruins that plan.
- dmoy 11mo agoAnd sales tax varies a loooooot, and change constantly There's 12000+ distinct sales tax regimes in the US https://sovos.com/content-library/sut/state-by-state-guide-to-sales-tax/ https://sovos.com/content-library/sut/state-by-state-guide-t...
- ryandrake 11mo agoIndividual stores generally only have to deal with one. Set the prices at the store, and make them tax-inclusive while you're at it. This isn't rocket science. Companies serve billions of web pages per second. We can't handle 12,000 tax calculations?
- jandrewrogers 11mo agoIf only it were that simple. Some sales taxes are conditional at the point-of-sale. Different customers may pay a different tax rate. This creates a situation where the display price will be incorrect part of the time and may not round to 5c or whatever the legal quantum is.
- pwg 11mo ago> make them tax-inclusive while you're at it. Often not a choice the retailer has. Local laws often require the shelf price be "not tax-inclusive". Reasons why vary, one common one is that in some instances different customers pay different rates (or none at all).
- 11mo ago
- coryrc 11mo ago> then they stand to lose from one to four cents per cash sale for any sale that is not a multiple of five cents Which is much less than they're paying the CC companies on card sales.