Why the taxes aren’t included in the final price in the US?

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Okay, even if they vary from state to state and from county to county, why not just include it in a final price anyway?

In: Economics

13 Answers

Anonymous 0 Comments

Shops do not want to include the sales tax in the prices they announce. This is so that the products look cheaper then they are. People who have decided to buy a product after seeing the price tag is less inclined to change their minds when they get the final price at the checkout, if they even notice the sales tax at all. So by not including the sales tax in the price tag the stores increase their sales. The more politically correct argument is that a lot of chain stores use common marketing material across all shops in the chain which includes the price. Altering the marketing material for each legislation would cause some complications. Especially for television and Internet advertisements that may not be able to have custom advertisements for each tax legislation region.

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