Question about coupons: Tax included vs. not included

[smartnewbie]

Hi guys,

I tried to find answers to the question above and couldn't find it. I know that it has been raised but no response so if I may ask again the below: (quote from original)

Pretty much all my save-on coupons include in the fine print one of 2 comments: "GST and provincial sales tax, if applicable, are included in the face value of the coupon" or "provincial law may require the retailer to collect tax on the full price of the item before deduction of the coupon value. GST/PST/HST (where applicable) is included in the face value of the coupon".
Is there a difference in terms of what that means to me the consumer??? I'm thinking it does especially for those save-on coupons of higher values such as say $2 or more??

It seems I ended up paying tax on the total value of the product regardless of what the coupon states but doesn't one mean the tax is already included and I only have to pay tax on the difference and the other means I have to pay tax on the full value? Ie. product cost $5, have coupon of $2 which states that tax is included in value of coupon. $5-$2=3 +tax of 13% on $3= $3.39

VS. $5-$2=3 + tax of 13% on $5=$3.65

All your helps is appreciated.

[NateandAva]

From what I understand, you always have to pay the full amount of tax on the item, despite the coupon savings because the store still needs to remit the PST/GST. However, if the price is less than the coupon value, than the GST and PST can be added into the savings. For example, the price is $4.50 for a razor and the coupon is for $5 and says that it includes GST/PST on the coupon, so you would only pay .04 out of pocket if you were in BC (12% tax - $4.50 x 1.12 = $5.04). Then the whole amount is reimbursed to the store by the company. If the coupon does not say includes taxes then I guess you can only use it if the product is that much. Hope this helps.

[smartnewbie]

Thank you