mardi 25 août 2015

Taxes and Pricing

Hi all-

We are formulating a menu and pricing for a carry-out restaurant in the U.S. I lived in the Netherlands for a number of years before returning to America. Two of the things I liked about purchasing items in Holland was (1) everything was rounded up or down to the nearest 5 Euro cents which saved carrying around pocket full of those annoying little 1 and 2 Euro cent coins, and (2) a VAT was already incorporated into the price, so if something was listed as 4.95 Euro on the menu that is exactly what you paid, the taxes were not added on after-the-fact. If you were really interested in seeing what your taxes were you could look at the receipt provided which broke-out VAT versus the product price.

I'd like to do something similar with my menu pricing in the U.S. so that the price for each item on the menu reflects the core price plus local and state sales taxes already incorporated. For example, a soft drink would sell for $1.75, with the retail price being $1.58 and a 10% sales tax of $0.17 already folded into the price.

So if the customer orders a drink for $1.75 and a meal for 8.95, all with taxes already included in the price, their total bill will come to $10.70. If they pay with $15.00 the change back will be $4.30.

The advantage I see is that without having to deal with pennies and the add-on sales tax the actual cash exchange at the register would be faster and more efficient, and the till count at the end of the day would be more accurate.

It would require careful calculating of pricing in advance, but I think modern POS systems could be programmed to do this.

Any thoughts? Has anyone tried this before? Is it even legal to conduct business with consumers without adding on tax after the fact? Your thoughts are appreciated.


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