We had taxes bundled in the price for years in Canada. And it was changed to being separate and added on at the point of sale. The rationale given at the time, was that people should know the actual price of the things they're buying, and how much extra they're paying to support government. Essentially, the argument is that the cost of government shouldn't be invisible.

> Essentially, the argument is that the cost of government shouldn't be invisible.

Brazil went through the same thing, but took the (imo smarter) approach of describing the tax breakdown in the receipt

Everybody describes the tax breakdown in the receipt. The variance between countries is in the menu/catalog price scheme.

The tax breakdown on the receipt is usually because certain people are allowed to reclaim the tax if the goods are used for certain purposes.

Obviously, the be able to reclaim the tax, they need to know how much has been paid on the transaction.

Yes, and it also helps to reduce or prosecute fraud where a merchant charges for a tax that doesn't exist.

I've never seen a receipt for gas that explained how much tax I was paying on the purchase.

In Australia all prices include GST (equivalent of VAT) but invoices typically show how much the GST component is, which seems to achieve both goals. Plus everyone just knows GST is 10% and applies to almost everything except food and a few essentials. So there's no hiding the cost of government.

Intellectually, I know that you are correct. However, to this day, every time I buy something a bit pricey, the extra charge always feels a bit dear. That contemplation isn't as likely if you haven't already internalized the pre-tax price. So while, we both "know" the cost of government, people who every day have to face those calculations in a very tangible way, probably feel it more acutely.

Perhaps, but why's that an advantage?

For the same reason that being more aware of your personal spending, leads to better personal decisions. Out of sight, out of mind, is a recipe for less oversight and responsibility from decision makers.

Governmental spending can be a huge drag on the economy, and people may not realize just how much, unless they are personally confronted with the true scale of governmental intrusion. Many people today take it all as an unquestionable given, rather than as one choice among many.

And yet that is exactly how gasoline is sold across the country!

Gas prices change very frequently, so almost everyone uses a digital display to show the price... it is much easier to change 3 or 4 prices than to change thousands of labels when the tax changes.

If the argument is that the number of products and consequent ease of updating pricing to include taxes, then there are a huge group of items that should include tax in the quoted price. Admissions tickets to a movie or concert, flight prices, anything digital/online that can be updated immediately like gas prices, vehicles, etc.

In other words, I don’t think that argument holds.

Flight prices are generally displayed all-inclusive in the US.[0]

0: https://www.theflightexpert.com/all-in-ticket-prices-usdot-r...

They should also require stores that have adopted e-Ink price displays to do it

Yeah, that's one of the many benefits of living in New Hampshire. But what boggles my mind is why people in other states are willing to put up with sales tax at all. You're already being taxed on income. Its just the government double-dipping at that point.

Wait you live in a state with state income tax? I’m not sure why you’re willing to put up with that. You’re just being double taxed on your income.

Income tax is progressive; sales tax is regressive.

That is implementation specific. And oversimplified. An income tax is regressive if you only look within a tax bracket including the highest one which arguably contains the highest level of disparity within it (quantitatively, though perhaps not qualitatively). More so income tax on capital gains. Just the ability to have the majority of your income taxed as gains is regressive. Sales tax that are limited to luxury goods are progressive. Food assistance is often exempted from certain sales tax, which is progressive.

We can make either type of tax regressive, progressive, or vary by income level to push people toward the median lifestyle.

Implementation costs and the ease of avoidance should be larger concerns I think.

In Nevada there's no income tax, some sales tax, but the vast majority of taxable purchases are luxury purchases made by wealthy tourists and there's also a hotel room tax.

So in that one case, choosing sales tax isn't regressive.

I know and generally I agree with taxing income for this reason. “Double taxation” is a silly reason.

Agreed. Especially given the wide range of sales and income tax rates.

The double taxation criticism was about sales tax.

I know. Not only is it silly to call it a double tax, it’s also not even correct. Even in NH that money is taxed at least 3 other times before you spend it. Sales tax would be at least the 4th tax on the same money.

* Sales Tax

* Income Tax

* Property Tax

People in all states pay some combo of those 3. Some say no income tax (FL). But that means higher sales tax and property tax. Others have all 3 taxes, but in lower amounts.

Do you really think in New Hampshire you pay less total tax then someone like me, living in the Midwest? You likely do better than NY/Cali, but not the Midwest..

And for all practical purposes your social security is simply a tax as it goes into the exact same bucket as taxes.

True, though that is a federal tax. The 3 taxes I posted - I was referring to state and local level taxes.

Bragging about no sales tax while paying a higher income / property taxes was a pretty funny / American thing to do..

Tax laws are confusing and nonsensical everywhere.

Seems to me for local taxes land-value tax is clearly the most sensible. It aligns the intensives much better.

On state and federal level you can use flat or progressive income tax.

I don't understand why anybody would do sales or value added tax.

But recently I have been thinking if land-value tax for everything just didn't make sense.

So someone lives in a $400,000 RV in an RV park. They won't pay property tax. Say they are living inherieted money. They won't pay income tax. So sales tax would be their only tax.

Obviously this is a cherry picked example and can't represent but .1% of the population. But each lever you pull for tax rewards/punishes a different group. A famous example if FL has no income tax, letting retirees stretch their fixed pensions further.

In general, if a state has a lot of tourists coming to it. They won't get property tax nor income tax on the visitors, but they WILL get sales tax. So it makes sense to raise the sales tax, so that you can lower the property / income tax for people that live there yearround.

The RV park would pay land value tax and that would be financed by the rend of the RV park.

Tourists will make some locations more valuable then others, so it should have an impact on property tax.

We in Ohio also have literally all 3 at the same time.

I'd rather not deal with sales tax, gets annoying sometimes with cash.

Sales tax and income tax serve different purposes in most countries. And very little of that purpose is actually "raising" revenue - the federal government can in principle always print whatever money it needs and hand it out to states etc. But they do help ensure the fiat currency has irreplaceable value, that there's not excessive money in the system, and for income taxes also help smooth out inequalities. And it's often simpler or less fraught for state-level taxes to be used to supplement revenue raising rather than rely on federal government hand outs.

Lots of states have no income tax

Nine states have no personal income tax. Of those, South Dakota and Wyoming are the only states that don't have business income taxes. So, only those two states have no income tax.

The sales tax rate can change (sometimes from city to city). It is easier to keep track at the register than it is to keep track in the aisles. That's my best guess.

The sales price can change at each store location. It would be even easier to put the full price on the item in the aisle. Stores now know their inventory and track it by the minute.

I've always thought that it's probably done to engender anger at the notion of sales taxes by making the difference much clearer than it is in other places where the prices are typically bundled, and to display a lower price than the consumer is expected to pay.

Not displaying the taxes is infuriating when visiting other places, since unless you look up all of the applicable taxes you're effectively just guessing at the cost of anything.

I think originally there may have been some "grumble why do we have to charge" but I feel much of it now is big stores wanting to advertise one price for the whole country as best they can - and "tax licensing and dock fees" is a way to get around the varying prices.

Tax is based on the consumer’s address. Technically, the price for you is $0.99.

edit: you can get a refund on the state’s portion of the sales tax, but not the city. (ex. WA state form https://dor.wa.gov/file-pay-taxes/apply-tax-refund/state-sal...).

It is based on where the item is sold if you go to a physical store like in the example.

Technically, it's the place of provision.

So in-store vs delivery, or online event vs in-person, etc.

Most entertaining: where I live, we have to charge the client's tax rate if it's consulting work, but our provincial tax rate if it's hosting.

Which is not necessarily where the car and the window sticker is, if we circle back to the root comment.

So either you’re in Alaska or you’re paying a state income tax on top of your federal income tax. They always get you somewhere!

You can try living/working in Vancouver WA and doing all your shopping in Oregon. But you technically have to report and pay use taxes.

That’s a pretty interesting idea. WA has crazy high car registration fees/tax so if someone wants to optimize this they need to drive a cheap car to decrease the burden

King county does, I’m sure Clark county is more reasonable.

While I like the idea of having the tax shown on the price tags... tax rates change a lot in most places in the US. The cost to change all the price tags in a store everytime the rate changes, and to do it overnight, would be crazy. Maybe once everyone uses digital eink price labels...

How often are you talking? More often than price fluctuations due to inflation? (fair bit of that recently!)

Price fluctuations aren't usually every item in the store at the same time. Sales taxes change several times a year in my locality.

Wow, that sounds crazy, remind me not to move there.

The price of the soda is $0.99, so that's the advertised price.

When you negotiate salary with a new employer, do you include the employer paid Social Security and Medicare taxes? Do you say I require $100,000 or $107,650 (Social Security is $6,200, Medicare is $1,450)?

In my experience in casual conversation all Americans say their salary as pre-tax, and in Europe it's more split where many people would say their salary is the post-tax amount.