Discount & Tax Calculator
Apply a percentage discount and tax to find the final price.
Stacked discounts multiply, they do not add
Two 20% offers applied in sequence do not produce 40% off. The second discount applies to the already-reduced price, so you pay 80% of 80% — 64% of the original, a 36% discount. The gap widens as the percentages grow: 50% then 50% leaves you at 25% off, not free. This arithmetic is entirely legitimate and entirely reliable at generating disappointment at the till.
The same logic applies in reverse to increases. A 10% price rise followed by a 10% discount does not return you to the original price — it leaves you 1% below it, because the discount is calculated on the higher number.
Order of operations changes the total
A discount applied before tax and one applied after tax produce different final amounts, because tax on a discounted base is smaller than tax on the full base. Standard retail practice in most jurisdictions is to reduce the pre-tax price and then charge tax on what remains, which is the order this calculator follows. If a promotion is described as a rebate or a cashback rather than a discount, it is often applied after tax and the effective saving is smaller than the headline percentage suggests.
Percentage off is not the same as percentage of
A sign reading "30% off" leaves you paying 70%; a sign reading "pay 30%" is a 70% discount. Retail signage exploits the ambiguity often enough that reading the final price rather than the percentage is a reliable habit. The other common trick is a reference price — "was 200, now 120" — where the reference was never a price anything actually sold at. Comparing against what the item costs elsewhere is more informative than comparing against the crossed-out number.
How to use it
- Enter the original price before any reduction.
- Enter the discount percentage — for stacked offers, run the tool twice rather than adding the percentages.
- Enter your local tax rate, or zero if the displayed price already includes tax.
- Compare the final figure against the receipt when you pay.
Before you rely on this
Do stacked discounts add up?
No. Sequential percentages multiply, so 20% then 20% leaves 64% of the original price — a 36% discount, not 40%. Run the calculator twice, applying the second discount to the first result.
Should the discount be applied before or after tax?
Standard retail practice in most jurisdictions applies the discount to the pre-tax price and then charges tax on the reduced amount, which is the order used here. Rebates and cashback are often handled after tax and save less than the headline figure implies.
Does a 10% rise then a 10% cut return the original price?
No. The cut applies to the increased price, so you end up about 1% below the original rather than back at it. The asymmetry grows with larger percentages.
Is the price already including tax?
It depends on your jurisdiction. Many countries display tax-inclusive prices to consumers while others add it at the till. If your displayed price already includes tax, enter zero as the tax rate to avoid charging it twice.
Disclaimer: These calculators produce planning estimates, not financial advice. Results exclude fees, taxes, insurance, and rate changes, and no output here constitutes an offer or a recommendation. Speak to a qualified, regulated adviser before making a financial commitment.