Saturday, March 01, 2008

The problem with the sales tax

In general, I think the sales tax is one of the fairest kinds of taxes. Everyone pays the same percentage of what they buy, unlike with the income tax, which punishes wealthier people by making them pay a higher percentage of their income. There is one big problem with the sales tax, however: stores don't include it in their prices.

The other day I was buying some notebooks in a store, and the total, with the sales tax, came to $11.96. I had two tens, a one, and 90 cents in change. Needless to say, I was pretty annoyed to have to break another ten for just six cents. It's not right that stores expect people to add up the prices of every item they're buying and then multiply it by 1.05 (the sales tax in my state is 5%) in their heads. It's not a huge problem for people who pay with credit or debit cards, since it doesn't really matter what the exact total comes to. But when people pay with cash, it can be very important to know ahead of time the exact amount you'll have to pay. What if I hadn't had that extra ten?

Yes, it would be a little more work for stores to include the tax in their prices, but it would not hurt stores as much as the lack of it hurts consumers. Store employees already have to calculate the sales tax; they just do it after the customer has come to the register to make a purchase, not before. It's perfectly reasonable to expect stores to label their products with the real prices.

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