Retail “rounding up “

[BigRed]

This is a shout out to retailers - especially those in the retail food industry. My wife and I went out to a local restaurant Saturday night with some friends. We had an excellent meal - the food was great and the service was excellent.

I don’t often review the bill line item by line item but just generally scan it to make sure it’s reasonably close to what I was expecting. When I looked at the bill I noticed something I‘ve never seen before. A notation of a $.01 charge for “rounding up.” I asked the server for an explanation and she wasn’t really able to provide a clear answer.

As an aside the people that we were eating with had no such charge on their bill.

Wondering if anyone can offer a brief explanation of the “rounding up” logic ?

I love filet.

Did you go with rare?

 

[Cameramonkey]

I dont think they can charge tax on the full price when you get it on sale. Tax is based on what you pay, not what the item is worth.

 

[amboy49]

It’s the little things like this that makes life interesting. Perhaps this should have gone in the First World problems thread ?

 

[Itchytriggerfinger]

I dont think they can charge tax on the full price when you get it on sale. Tax is based on what you pay, not what the item is worth.

They probably stuck him with the entire 72¢ worth of tax on the item and let his friend bathe in the warmth of of the 36¢ he saved.

 

[Ingomike]

They probably stuck him with the entire 72¢ worth of tax on the item and let his friend bathe in the warmth of of the 36¢ he saved.

You are just a quick step ahead of me tonight, beating me to the next point. LOL

I would like to see the other bill.

 

[ditcherman]

I dont think they can charge tax on the full price when you get it on sale. Tax is based on what you pay, not what the item is worth.

So the POS ignores the discounted price? Seems the programmer has to work extra hard to make that work, but makes it look like the programmer works for the state.

When I first got started in my business the salesmen helping me get set up (yes I took accounting advice from salesmen) told me there were two ways to do it; separate out cost of product, charge end user sales tax and send that in, or pay sales tax myself and bundle product with service. The salesmen advised me that the end user should only see the list price, not the discounted price that I would get from buying in quantity, paying early, managing inventory, etc, but that would result in the state getting more sales tax revenue than what was actually transacted, and in my interest to be more like BigRed (tm) (INGO wasn’t even a thing yet) I refused. They got their share on the actual price, not list, and I’ve always wondered how much extra they make on deals like this.
To be clear, my product is now not subject to sales tax as an input for farming.
It just really burns me how the state can double dip like this.

 

[DoggyDaddy]

I dont think they can charge tax on the full price when you get it on sale. Tax is based on what you pay, not what the item is worth.

I think it's kind of murky. For instance, when you use Kohl's Cash, it rings up full price (with tax) and then takes off the discount from the total.

 

[Leo]

One place my wife likes has been charging a "covid fee".

I think there is outright thievery at the registers. Some things get run up as wrong prices. If you pay attention, they just say "well that is what it says". I'll bet 90% never even notice, especially those who don't use cash.

The Arby's in Lafayette is programmed to charge you the tax on the full amount, when you use a coupon. I have pointed it out to the manager several times over a year. He acts like he doesn't know about it every time. I quit going there. An extra 21 cents on my order will not kill me, but it is still wrong. I would love to add an extra 7% to every sale I make in my business. Again, 90% of customers probably cannot multiply $9.00 times 7%, so it keeps working. And I am just that grumpy old cheap guy.

 

[ditcherman]

One place my wife likes has been charging a "covid fee".

I think there is outright thievery at the registers. Some things get run up as wrong prices. If you pay attention, they just say "well that is what it says". I'll bet 90% never even notice, especially those who don't use cash.

The Arby's in Lafayette is programmed to charge you the tax on the full amount, when you use a coupon. I have pointed it out to the manager several times over a year. He acts like he doesn't know about it every time. I quit going there. An extra 21 cents on my order will not kill me, but it is still wrong. I would love to add an extra 7% to every sale I make in my business. Again, 90% of customers probably cannot multiply $9.00 times 7%, so it keeps working. And I am just that grumpy old cheap guy.

I try to remember my vitamin d so I’m not grumpy, and I’m pretty spendy, and I think it’s thievery as well.
People just rolling over at the mere thought of the states big stick.

 

[Cameramonkey]

I think it's kind of murky. For instance, when you use Kohl's Cash, it rings up full price (with tax) and then takes off the discount from the total.

Not really. You are making it murky by comparing apples and oranges. Kohls Cash and other credit rebates are still a payment you are paying, no different than somebody chipping in a $20 bill to cover their part of the bill. The tax is on the item, not the tender.

Just like how the IRS considers credit card write-offs as earned income; when you negotiate a settlement to get out from under a large credit card bill, they 1099 you for what they wrote off. In the end, you spent their money to enrich yourself and get "stuff". That stuff has value, and since you didnt pay them back, you earned that value at no cost to you... which is income. Frankly, Im surprised the IRS hasnt tried to tax us on things like Kohls cash, cash back rebates on credit cards, etc. as income.

Its all about the money you are spending to get whatever you get. Not what its really worth. Otherwise when you buy a clearance item at 50% off, you'd pay the tax on the original price. (which you dont)

 

[amboy49]

Actually, I’m more upset about the rounded up $.01. My friend does favors for me that cost him money out of pocket so me paying the extra $.37 of the tax is a heck of a bargain in the total scheme of things.

But the restaurant get the rounded up penny.

Hasn’t this been a fun excercise !

 

[JettaKnight]

Fillet mignon cooked medium?

 

[JettaKnight]

Not really. You are making it murky by comparing apples and oranges. Kohls Cash and other credit rebates are still a payment you are paying, no different than somebody chipping in a $20 bill to cover their part of the bill. The tax is on the item, not the tender.

Just like how the IRS considers credit card write-offs as earned income; when you negotiate a settlement to get out from under a large credit card bill, they 1099 you for what they wrote off. In the end, you spent their money to enrich yourself and get "stuff". That stuff has value, and since you didnt pay them back, you earned that value at no cost to you... which is income. Frankly, Im surprised the IRS hasnt tried to tax us on things like Kohls cash, cash back rebates on credit cards, etc. as income.

Its all about the money you are spending to get whatever you get. Not what its really worth. Otherwise when you buy a clearance item at 50% off, you'd pay the tax on the original price. (which you dont)

Menards rebates are weird, too.

Just the other day I realized that I'm not paying sales tax when I use the rebate card - which sort of makes sense as I already paid sales tax on that before.

 

[Ingomike]

Fillet mignon cooked medium?

I would expect that to be your style...

 

[amboy49]

Fillet mignon cooked medium?

Medium rare

 

[JettaKnight]

Medium rare

 

[Timjoebillybob]

The Arby's in Lafayette is programmed to charge you the tax on the full amount, when you use a coupon. I have pointed it out to the manager several times over a year. He acts like he doesn't know about it every time.

From my understanding tax is supposed to be charged on the pre coupon cost. You are paying the full amount, the coupon is considered a form of tender. And it is, retailers get reimbursed for the amount of the coupon, and on the back of everyone I've looked at it states the user of the coupon is responsible for all taxes/fees/etc.

See below for a better explanation.

Not really. You are making it murky by comparing apples and oranges. Kohls Cash and other credit rebates are still a payment you are paying, no different than somebody chipping in a $20 bill to cover their part of the bill. The tax is on the item, not the tender.

Its all about the money you are spending to get whatever you get. Not what its really worth. Otherwise when you buy a clearance item at 50% off, you'd pay the tax on the original price. (which you dont)

.

 

[mbills2223]

The most infuriating part is that they used (0.01) to indicate a CHARGE of 0.01.

 

[Leo]

That is interesting, the manager always presses a few buttons and gives charges the tax on the reduced price.