The store is just in a single town, it is trivial for them to fix their labels. For the user on the other hand it isn't trivial to figure out the tax rate for every store they visit as they travel since as you admit it changes everywhere.
For a big corp, they want to advertise nationally. "$1 hamburgers!" or "$799 refrigerator!". You can't make a national ad if you have to have precise pricing.
Not the strongest argument, but there it is.
A college friend worked at a pizza place that straddled a county line. One county had its own sales tax; the other did not. The register was in the back of the store to take advantage of this (the location of the register was considered the point of sale for tax purposes). Question: would it have been legal for them to advertise a price in the higher-tax-county part of the store that only applied if you bought the pizza from the outher county?
Local sales tax and national VAT are similar, but they don't work that much alike in practice.
> For a big corp, they want to advertise nationally. "$1 hamburgers!" or "$799 refrigerator!". You can't make a national ad if you have to have precise pricing.
If we zoom out of the “uniquely American issue” mindset for a second and look at how this is solved elsewhere, then it becomes clear that it doesn’t have to be an issue.
In this day and age plenty of multinational corporations advertise a euro price that applies for all the countries in Europe that carry the euro. This is a situation where companies have to account for varying VAT rates.
The solution? Companies take this into account w/r/t their margins when advertising a euro price that applies to all euro countries.
In the US however it’s even less of an issue.
I’ve noticed as a European that when you watch TV here in the US many ads are hyper localized, mentioning the closest local store.
If they can do that then they can list the price the item has at that store.
The real reason the full price including taxes isn’t used is because companies can make it look cheaper without hurting their margins, thus draw in more customers.
> Companies take this into account w/r/t their margins when advertising a euro price that applies to all euro countries.
Or they just recalculate the price based on you shipping info.
It would be rather absurd to expect companies to just “account” for an up to 7% difference in tax rates between different countries.
> TV here in the US many ads are hyper localized
While there are many local channels in some states the tax rate might even differ between counties or towns.
> The real reason the full price including taxes isn’t used is because companies can make it look cheaper without hurting their margins, thus draw in more customers.
Conjecture. Also you’re assuming that most people are incapable of doing basic math.
It’s not that. If you have to always show the full price any ads which include it become pretty much illegal (besides physical billboards etc.) unless you can somehow figure out where the person viewing it lives (not an option for TV).
While I wouldn’t mind if most ads just disappeared I don’t see how effectively banning businesses from advertising their prices would benefit the consumers.
