Stacked discounts and sales tax: find the final price
Calculate sequential promotions correctly and see why two discounts are not usually added together.
Multiply sequential discounts
If a 100 item gets 20% off, it becomes 80. A further 10% off the reduced price makes it 72, not 70. In one expression, final pre-tax price = list price × (1 − 0.20) × (1 − 0.10). The combined reduction in this example is 28%.
Apply tax at the appropriate stage
With an 8% sales tax on the discounted 72, total is 72 × 1.08 = 77.76. Actual tax treatment can differ by location, product, coupon type or whether a fee is taxable. For a fair comparison, put shipping and required fees into both offers and use the same tax assumption.
Beware of promotion limits
Check whether coupons stack, whether a discount has a maximum, and whether tax is charged before or after a manufacturer rebate. If one offer has a bundle or different pack size, compare the unit price of the quantity you actually need. A large percentage sign alone does not establish the cheapest final purchase.
Try it and keep reading
Try your numbers in discount, sales tax. Then read the related guide for context and assumptions.