Adobe charges subscription cancellation fee

Re:Adobe charges subscription cancellation fee by tekknik on Tuesday April 13, 2021 @08:19PM (#26801431)

I can think of at least one reason where tax calculated on the final total vs each price is better (for the consumer), rounding. With tax calculated on the final total, you pay at most $0.01 extra in rounding “errors”. However with tax calculated on each price you pay at most number of items times $0.01, which is more and could add up over time. I personally want to give the gov as little of my money as possible.

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Re:Adobe charges subscription cancellation fee by TeMPOraL on Wednesday April 14, 2021 @04:34AM (#26804450)

That depends on whether they're rounding, or taking a floor or ceiling :). With proper rounding, it's a wash. I just did some back-of-the-dev-console calculations on a random groceries receipt I found on my desk, and I discovered that if the tax was calculated per item, I'd pay 0.01PLN less of it!

Regardless of the rounding method, the fair way is to sum up purchases and compute tax on the total, precisely to minimize the loss of precision on rounding.

Curiously, as far as I understand the Polish tax code (IANAL), the choice of the method to use is actually given to the vendor! The law recommends[0] that you calculate the tax by multiplying the rate with the total taxable amount, but also allows[1] the seller to choose to calculate per-item tax, and sum that. In both cases, mathematical rounding (half-up) is used[2].

But in practice, there's little to no difference unless you're doing a single purchase of a lot of items with weird pricing bias.

[0] - Dz.U.2020.0.106 t.j. - Ustawa z dnia 11 marca 2004 r. o podatku od towarów i usług, art. 106e., ust. 7.

[1] - ibid., ust. 10.

[2] - ibid., ust. 11.

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Re:Adobe charges subscription cancellation fee by tekknik on Wednesday April 14, 2021 @08:20AM (#26806061)

> That depends on whether they're rounding, or taking a floor or ceiling :). With proper rounding, it's a wash.

Agreed! If they are actually rounding it will be a statistical wash.

> Regardless of the rounding method, the fair way is to sum up purchases and compute tax on the total, precisely to minimize the loss of precision on rounding.

Again, agreed, this is why we do it this way in the US.

> Curiously, as far as I understand the Polish tax code (IANAL), the choice of the method to use is actually given to the vendor! The law recommends[0] that you calculate the tax by multiplying the rate with the total taxable amount, but also allows[1] the seller to choose to calculate per-item tax, and sum that. In both cases, mathematical rounding (half-up) is used[2].

US tax code, at least as far as income taxes go, uses the same rounding method (nearest decimal) however sales tax is can be quite a bit more complicated [1].

Also somewhat related, we quote our fuel prices to 3 decimals.

[1] - https://blog.taxjar.com/rounding-issues-sales-tax-returns/

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Re:Adobe charges subscription cancellation fee by account42 on Wednesday April 14, 2021 @06:33AM (#26805180)

This assumes VAT is always rounded up, which is not the case in e.g. Germany where it is rounded to the nearest cent - so the average rounding error cancels out to 0.

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Re:Adobe charges subscription cancellation fee by tekknik on Wednesday April 14, 2021 @08:09AM (#26805960)

Note i said generic tax, not VAT. And I’m specifically talking about the US

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