Canada has implemented a new tax savings from December to February for some things like taxable groceries, crafts, and gaming physical media. I wanted to get a new Xbox controller and found the best price at Walmart for $55 a week ago. The tax holiday starts today and I now see that the $55 has increased to $62 and change, which is about how much tax I should be saving. Great to see this thinly veiled attempt to help Canadians ( /s - win votes) is just going to be extra profit in the corporations’ pockets.
This is exactly what the “Taxation is theft” morons don’t understand. They think if the government no longer takes their cut, everybody will just have X amount of money more, and the market won’t just swallow that up without giving you a single thing in return.
Is that legal? (Am American - idk about Canadian legal strictures around that, but it definitely feels like it’d run afoul of some sort of consumer protection legislation or something like that)
companies will 100% of the time do anything even illegal things to make more money.
that’s the thing that pisses me off: the tax often increases the perception of how much people are willing to spend. even if you remove or decrease the tax, the companies just inflate the price to fatten their margins. Rule #1 of capitalism: the consumer always loses.
I am just really glad none of the crap I sell is included. The list and logistics to comply with this “holiday” is insane.
Lets say you run a liquor store:
- Beer, cider, sake and wine are now not taxed
- But wine, cider and sake over 22.9% is still taxed
- Spirit coolers and premixed alcoholic beverages are now not taxed
- Spirit coolers and premixed alcoholic beverages over 7% are still taxed
- Gift boxes/baskets are taxed
- Unless those boxes/baskets have more then 90% the value in beverages that meet the tax holiday requirements
This is not even opening the other categories (Oh don’t even think about child car seat/strollers). The cost of this program on stores and taxpayers (the cost of it is payed by the lack of tax and also the tax collected being diverted to this program) is not worth the 5% off some people will see (since most places will just up the price 5%).
Edit: and as the radio just pointed out this is a tax break on mostly luxury goods so it only really helps the people who don’t need the help. (the example given was a dinner party would be 5% cheaper but a single parent’s heat is not).
It would cost thousands in labor to set up temporary tax rates based on alcohol content. Most systems have tax rates which apply to product categories, not alcohol content. Liquor store pos systems in the US, at least in my state, typically don’t even store the abv in the price book, which would make this taxation virtually impossible to comply with.
Yeap, this is Canada where stuff like this is rolled out in a month or so and businesses are just told to comply.
(Oh and those examples are from the Canada.ca official list not hyperbole)
Edit: it also comes with a friendly threat!
"Make a reasonable effort to comply
Businesses who make reasonable efforts to comply with the legislation will not be the focus of our compliance actions.
We will be focusing on situations where businesses willfully and egregiously refuse to comply with the temporary measures, such as a business that collects the GST/HST and does not remit it to the CRA."
Crazy, they’re basically saying, ‘we know this is impossible so just do your best, as long as you remit everything you collect then it doesn’t really matter what/how you collect’.
This is very unfair to the small business because inevitably there will be some customers who will be pissed off when the store doesn’t collect properly, and small business won’t even come close to doing it correctly.
Making temporary short term massive changes to taxation is a very dumb idea. Canada must be drinking uncle Sam’s koolaid to be acting this foolish.
Most people don’t even care and did not know this even started, its just another failed attempt of the current government to gain support.
This one is extra silly, but the silver lining is that it has got people of drastically different political viewpoints something to agree on. You could have a talk show with the most rabid pundits from opposite sides discuss this and the only arguments would be what the worst part of this plan is.
There is also another component to this as well, everyone is supposed to get $250 in the mail (or direct deposit). And that’s also just bad tax policy that has been made fun of in the past. On top of that they have not managed to actually pass legislation or even figured out how to do this at this point. Oh and the post office is still on strike.
I think the answer here is to buy that somewhere other than WalMart. Are there any stores nearby that didn’t increase their price on the controller?
I would support Canadian Tire over Walmart.
The time that product spends on the shelves of a Canadian Tire is just a layover before its permanent move to a landfill. They are Coors quality at Heineken prices.
I bought a Husqvarna chainsaw from Canadian tire and it was garbage. I thought I was getting the same one my buddy got (he got his at the local kubota). Turns out Husqvarna just licenses out their name for the right price. It was a garbage chainsaw with orange plastic and the sticker was even upside down.
Do they sell xbox controllers?
No, but Best Buy does. As does Canada Computers, Shoppers Drug Mart, Gamestop, etc. none of which are as bizzarely aggressive about nonsensical pricing schemes.
Seems like an opportunity to use this in attack PP’s tax-cut rhetoric, and to attack the oft-repeated talking points from business that tax increases will be passed on to consumers.
Tax cuts are eaten by businesses, so long as the businesses believe that people will continue to buy. Tax increases will also be eaten by businesses, so long as the businesses believe that people will refuse to buy at a higher price. It’s all being taken by or from shareholders.
It’s a shame no political entities will actually touch this with anything more pointed or useful than “that’s appalling!”
Kroger (grocery store) is doing the same thing this week. They’re doing a 20% off “holiday bonus” discount on a one per-customer basis (20% off your entire order). The catch? Every item in the store is at least 20% more expensive than it was last week.
Time to introduce the “lowest price from the last 30 days” requirement like in Europe.
Can you explain this? Never heard of it.
EU for online purchases mandates that the lowest price from the last 30 days be displayed alongside the actual price and discount. So they can’t pull the “make the price higher and discount to a higher price than it used to be” trick, best they can do is make price higher and discount it to what it has always been. Which is pointless to them because they’ll just get less sales in the month before. Also a month is enough time for the loss of sales to be significant that it isn’t worth it to keep the price high to create a “bargain”.
Thanks this is really interesting. Literally hadn’t heard of this before.
I’m guessing J.C. Penny’s doesn’t have EU stores?
Ah, the very store that tried “no sales so we can give you year-round low prices”!
Until they found out we consumers ain’t gonna buy unless somebody puts the word sale somewhere every once in a while.
dont expect it to go back down
I don’t buy soda often but fuck I’m tired of their soda sales. Buy 2 get 1 free on 12 packs. (9.99) A piece. Then 1 week out of the month or so they are buy 2 get 3 free. Still 9.99 a 12 pack.
So that’s:9.99 for 12 cans. (.83 cents per can) 19.98 for 36 cans (.56 cents per can) 19.98 for 60 cans (.33 cents per can)
I really don’t need 60 cans of soda, but I don’t want to pay .83 cents per can. So all it’s done is make me stop buying soda all together for the most part.
It can’t be coke doing it either, because it goes for “all Coke, Pepsi, and Dr. Pepper products”
As someone who somehow managed to never get hooked on drinking soda, it baffles me how expensive soda is
In any reasonable country, that should be illegal. In many places it is
In Italy when the government reduced vat on ebooks from 22% to 4% not a single publisher passed the savings to the customer and they even increased the prices
Name one. Price hikes are not illegal in any country in Europe. Changing prices after selling and other shady stuff is illegal in most European countries on the other hand, but this is not it. If the 55 were on sale before, a “sale” price can be axed as most see fit. This screams coincidence and bad luck to me.
It should be illegal for any store to increase prices by more than 0.5% per month for any product in my opinion.
Even if massive inflation hits they can still increase prices by 6% after a year, but they at least won’t be able to immediately increase prices by 10-20% after taxes are lessened or a month before a sale is supposed to start.
All this will do is create a black market full of scalpers who are incentivized to buy the entire stock of a good if the market is willing to pay significantly more.
whatbif it’s a cash only store that wants all post-tax price to be integers or integers + quarters?
An authoritarian, controlled economy will fail. We don’t need any more examples to understand why.
You should loose the comma, then i agree with you. An authoritarian controlled economy will fail. A controlled economy is an absolut must.Without rules, that’s anarchism. That will fail either. Case in point: The USA. None of the rules are enforced and capitalism gone wild just bought the government outright.
See, trickle down economics works ladies and gents /s
Fuck this is gold.
Well, unless people realise the actual worth of gold… But until then.
How would trickle down work with gold? I’m picturing some kind of golden shower?
sigh
unzips
This has nothing to do with supply-side versus demand-side economics.
EDIT: Actually, I take that back. It does to the extent that it is aiming to provide an incentive on the demand side, which is the opposite of what you’re complaining about.
That’s not really relevant. A break in sales tax that just targets consumer necessities should be a progressive tax.
The problem is that a lack of competition in this country means that grocers can raise their prices with no fear of losing customers
It doesn’t matter how much competition there is of they’re all going to do it anyway.
It does. Competition is literally the only mechanism that drives greedy actors to lower prices or improve their service. Without competition they hoarde.
literally the only mechanism
You forgot about laws.
No I didn’t, price control laws don’t work. Companies will find another way of maximizing profits and screwing you.
“only the market can fix this”
Gestures broadly at the market
Multiple competitors just results in them all agreeing to raise prices when taxes are lowered.
Out of curiosity, how do you propose increasing the number of competitors? Or is this a situation of “gee, that would be nice. Oh well, I guess nothing can be done.”?
Multiple competitors just results in them all agreeing to raise prices when taxes are lowered.
Price signalling happens in situations with low competition, in a healthy, competitive market, if you raises prices someone will undercut you to take your business.
Out of curiosity, how do you propose increasing the number of competitors? Or is this a situation of “gee, that would be nice. Oh well, I guess nothing can be done.”?
You literally just break up grocery store companies and stop them from merging in the future. The solution is not complicated.
Reminds me when Alberta reduced the tax on gas, and within a few weeks consumers were paying the same amount again
Ontario did this too. Took a few weeks tops, and now we pay the same as we always have, except none of the money goes to our roads, just to big oil.
Thanks Ford.
His supporters say it’s because Trudeau has too much tax on gas
His supporters don’t ever shut up, despite how uninformed they tend to be.
I laugh because he keeps extending it too and I sure and shit bet he will extend it again so the next government to come in has a poison pill in killing his gas rebate effectively raising the price of gas drastically overnight.
This is 100% intentional by the OPC. Bunch of fuckwits.
Betcha you get reminded again when Canada sweeps the cons in because cArBOn tax and then we pay the same by Monday for everything.
Tax credits are always a government gift to corporations.
the prices probably won’t go back down in february, either.
They may go down 3% for some products and they’ll make a big deal out of it.
Prices go up and stay up.
They’ll only go down if customers stop buying, which they won’t.
Well the debate should be over whether the taxes cause things to be expensive or it’s corporate greed causing things to be expensive.
Next time you see one of the ubiquitous Poilievre ads claiming it’s taxes that’s making things unaffordable, think about where the problems actually are.
I don’t say any of this to say that I think what Walmart is doing here is ethical, onky to say that it is logical from their standpoint if they assume there won’t be any blowback.
Companies charge what they think they can get for a product. The tax is part of the price. If they think an item will sell for $5.26 including tax, it is reasonable for them to think it will still sell for $5.26 if the item isn’t taxed.
That isn’t to say this is nice on their part, but the current system doesn’t incentivise them to be nice. It incentivises profit.
It does seem like they took the easy route to gain more profit. It is likely that, in the a absence of tax, their profit would be maximized by a price that is somewhere between the old pre-tax price and the old post-tax price.
Working behind the scenes with retail pricing (not Walmart) I can say this is 100% how it works.
Also have been given a sheet listing all of my department’s products that were below a specific profit margin. Told that we had a sale coming in 2 weeks so make sure to raise prices on those before then so that I didn’t have a drop in my overall department sales. If the customers noticed and asked, we were to inform them the ‘sale’ was to offset the price hike that just happened because we were looking out for them.
Raising prices then advertising a “sale” at the same/higher price IS actually against the law though. Unfortunately we have terrible enforcement of these laws but they do exist:
Is it against the law if they legitimately don’t lower the price after though as the above poster is being told to give as a reason, but we know isn’t true?
Yeah. Calling something a sale at a price that’s not actually discounted under the regular price (with some caveats on how long it needs to be at said regular price), then yeah it’s a violation of the act. Basically false advertising.
Bumping up the regular price to cover what you’d have otherwise saved on tax is dickish but not against any regulations AFAIK
Yeah, I shouldn’t have been surprised. This is normal psychopathic behaviour for a corporation.
