Legality of fees & surcharges

In BBBs trip report she mentions a "franchise fee" added to a restaurant bill.

I am wondering how all these fees are legal. Before I enter a business transaction (food for money) I must be entitled to know the full cost of the item. If it says $10 on the menu, this is what I should be obliged to pay. Legally speaking, if a 5% surcharge is acceptable, why not a 100% surcharge?

Am I obliged to read the full menu cover to cover in search for fine print? Or is the restaurant obliged to let me know the price?

Not adding the taxes to the price up front, btw., is soemthing else that pisses me off (I am foreign tourist, obv.). I know that the US is so deeply used to this deception, that nobody even sees a problem there. Just letting you know that this is not the standard in most places on this planet. The price on the tag, menu, or whatever is what you pay (less in some places, more only in the US).

Quote: Canyonero

In BBBs trip report she mentions a "franchise fee" added to a restaurant bill.

I am wondering how all these fees are legal. Before I enter a business transaction (food for money) I must be entitled to know the full cost of the item. If it says $10 on the menu, this is what I should be obliged to pay. Legally speaking, if a 5% surcharge is acceptable, why not a 100% surcharge?

Am I obliged to read the full menu cover to cover in search for fine print? Or is the restaurant obliged to let me know the price?

Not adding the taxes to the price up front, btw., is soemthing else that pisses me off (I am foreign tourist, obv.). I know that the US is so deeply used to this deception, that nobody even sees a problem there. Just letting you know that this is not the standard in most places on this planet. The price on the tag, menu, or whatever is what you pay (less in some places, more only in the US).

Yes, you are obligated to read the menu about charges thought the restaurant is obligated not to make it hard to find.

As to sales tax I prefer it be a line-item instead of hidden like the VATs in other countries.

It's actually illegal to include sales tax. Government knows they'll get less more often than getting more. It's possible to have an argument about legality but seems useless and would have to be fought every time. Some jacko place yesterday I walked into advertising daily lunch specials, then was told was only Monday through Friday. Looked at the menu, then the specials menu for future reference. Cranky lady mentioned my looking at specials menu condescendingly and I left. Excuse me for being suckered in by false advertising you know, then being treated without respect. It's bad what we accept, but it's a jungle, no values, inhumane culture.

I think there's a few special situations where businesses're allowed to list post-tax prices, but the circumstances escape me. I know I've seen it at a few restaurants, but the most obvious example would be in telecoms.

Quote: Venthus

I think there's a few special situations where businesses're allowed to list post-tax prices, but the circumstances escape me. I know I've seen it at a few restaurants, but the most obvious example would be in telecoms.

Airlines generally quote international fares including all taxes and surcharges. If they didn't, you will get sticker shock.
Take the roundtrip coach fares from USA to Europe.
A cheap fare usually runs around say 500.00 usd and up roundtrip.
So 500.00 is what the airline actually gets.
But when you add all those taxes due to entering a variety of European counties, taxes usually exceed the base fare the airline gets.
Therefore a 500.00 usd base fare ticket , when adding taxes, usually add up to about a 1100.00 ticket or more.
Yup, the taxes often exceed the actual cost of the air fare itself when buying a USA to Europe airline coach roundtrip ticket.
So typical ticket 500.00 base fare plus 600.00 in taxes and fees equals a 1100.00 airline ticket.
Those 600 in taxes, USA gets about 50 to 60 bucks depending on which airport you are using, the rest is Europe taxes.

Quote: onenickelmiracle

It's actually illegal to include sales tax.

How does that benefit the consumer? (Who Congress supposedly had in mind when they made this law.) On second thought, I withdraw my question.

Quote: Venthus

I think there's a few special situations where businesses're allowed to list post-tax prices, but the circumstances escape me. I know I've seen it at a few restaurants, but the most obvious example would be in telecoms.

In PA years ago the State Stores used to include tax on prices of booze before the state stopped them from doing it.

Yes, you read all of that right.

Quote:

It's actually illegal to include sales tax. Government knows they'll get less more often than getting more.

I don't understand this. ?? Why would govt get less sometimes or more ??

Quote: onenickelmiracle

It's actually illegal to include sales tax. Government knows they'll get less more often than getting more.

What does including sales tax in the listed price have to do with someone underpaying the govt the tax?

My aunt used to have a restaurant and sales tax was charged on top of the listed price (as it normally was) and she underpaid the govt like half of it. Didn't seem to stop her.

Theft from a merchant by refusal to pay is not something you want to be charged with; its too easy to convict. The merchant is a local businessman who probably gives free coffee to the cops, you are a tourist.

Some surcharges do not have to be on the menu such as a zoning overlay near an urban improvement which raises the sales tax an extra half point or point. The notice is considered in the zoning not the menu.

Some of this C&F or CNF stuff is outrageous as is gratuity calculated on each order rather than on large parties.

You can always protest but its best to be alert and look for signs and look for fine print on the menu. Pregnant women and alcohol, eggs, meat, etc. are standard but when you see CNF get up and leave even though its four percent.

The worst thing is an automatic gratuity irrespective of size of the party and also a blank gratuity line on the credit card slip that you sign. That is an attempt to Double Charge. Be Alert.

Quote: terapined

Airlines generally quote international fares including all taxes and surcharges.

And they usually round it UP to the next dollar. It's only when you get to the payment page where you see the itemization, and find out the slight difference.

Since it's less than a buck on a total of several hundred, and it's LESS than previously quoted, nobody objects.

Quote: terapined

Airlines generally quote international fares including all taxes and surcharges. If they didn't, you will get sticker shock.
Take the roundtrip coach fares from USA to Europe.
A cheap fare usually runs around say 500.00 usd and up roundtrip.
So 500.00 is what the airline actually gets.
But when you add all those taxes due to entering a variety of European counties, taxes usually exceed the base fare the airline gets.
Therefore a 500.00 usd base fare ticket , when adding taxes, usually add up to about a 1100.00 ticket or more.
Yup, the taxes often exceed the actual cost of the air fare itself when buying a USA to Europe airline coach roundtrip ticket.
So typical ticket 500.00 base fare plus 600.00 in taxes and fees equals a 1100.00 airline ticket.
Those 600 in taxes, USA gets about 50 to 60 bucks depending on which airport you are using, the rest is Europe taxes.

What I've seen is about a 1/3rd of the extras are real taxes levied by governments, 10% are airport fees (landing fees, airport improvement fees, etc) and the rest transportation surcharges levied by the airline themselves (fuel and other variable costs). The latter to me are the airlines problem and should be wrapped p in the base fare... but of course they aren't, just like a resort fee or, as the OP talks about, a franchise fee at a restaurant. Never seen one of those, and it'd be the last time I eat at a place that charges it when I see it.

There's a great breakfast joint near here that refuses to split bills or have multiple credit cards used to pay the bill. As such, we never go there any more. It's amazing how people will cut their own throats...

This type of thing bugs me. If I have a 100$ bill at a restaurant and tip $20. That's a good tip. But some places have 10-12% or more in restaurant/sales taxes. So that 100 check becomes say 112 after taxes. Should I tip $20 or $21.20 to tip 20%? The answer to me is obviously $20 why the f**k am I tipping on the sales tax? Not everyone sees it that way. Obviously in a large group situation this could add up to more money, see example below:

Long ago at my wedding I paid about $500 too much to the caterer. Who insisted that she had to charge sales tax on the service charges for the waiters and bar tenders etc. Instead of just the food and beverage. I told her a large part of my business was reporting this kind of thing to the state (MD in this case) and I was positive you don't charge sales tax on labor. But she insisted. Didn't seem like it was worth ruining my wedding over but it's been over 10 years and it still bothers me. :)

Quote: onenickelmiracle

It's actually illegal to include sales tax.

Not always true. It varies from state to state.

And there are lots of exceptions: gasoline prices always includes sales tax, and movie theater tickets sometimes do, too.

I know of at least one pizzeria near me which specifically says "tax included in price". It's a very popular pizzeria with multiple locations around town-- if they were breaking the law, they'd have been busted long ago. Even IRS agents occasionally eat pizza.

Quote: FleaStiff

The worst thing is an automatic gratuity

"What? We didn't eat no gratuity."

Quote: reno

Even IRS agents occasionally eat pizza.

Do they have souls of first-born children as a topping?

Isn't Hawaii's sales tax added on all menu prices already?

Coupons are a good example of taxes. Had a coupon for a free ecig. Should have been free but was charged a penny just to force me into paying sales tax. Obviously we're all used to not owing tax on free or comped things so feels like robbery essentially paying for something frivolous like a private airport or something somewhere down the road the way politics are now.

Quote: RS

I don't understand this. ?? Why would govt get less sometimes or more ??

If they included the sales tax on all items then people would see the real price they're paying and more than not buy something cheaper. Everyone has thresh holds, which is obvious when you think of pricing schemes such as 9.99! That 1 penny means they don't have to make the price double digits ($10.00).

If someone walks in to a burger establishment and expects to spend about $8 on a decent burger, but sees that after tax it's really over $10, then perhaps they'll buy something else under $10, or not also order an appetizer since it's pricier than they expected, etc. Overall, the customer will spend less money because they're more aware of the actual cost, which means the governments will make less money from the taxes. The gov wants you to spend more, so they can collect more in taxes.

Quote: thecesspit

What I've seen is about a 1/3rd of the extras are real taxes levied by governments, 10% are airport fees (landing fees, airport improvement fees, etc) and the rest transportation surcharges levied by the airline themselves (fuel and other variable costs). The latter to me are the airlines problem and should be wrapped p in the base fare... but of course they aren't, just like a resort fee or, as the OP talks about, a franchise fee at a restaurant. Never seen one of those, and it'd be the last time I eat at a place that charges it when I see it.

There's a great breakfast joint near here that refuses to split bills or have multiple credit cards used to pay the bill. As such, we never go there any more. It's amazing how people will cut their own throats...

Decided to look at Tampa (where I live ) to Paris (in the news) roundtrip Mar 14 to 21. (on vacation but not going Paris)
Here is my display regarding fare fees and tax breakdown
Base fare each way is 316.50 and 316.50 for a total roundtrip 633.00.
Taxes and fees 657.50 total.
Now 35.40 is a us tax, 5.50, 7.00 5.00 and 11.20 13.50 are all fees and airport improvement taxes
From Europe we have the real huge tax of 516.00 , 26.40, 33.90 and 5.40
No fuel surcharges on this ticket so bottom line
United collects 633.00 on a 1290.50 priced ticket.

Below is a copy from my display showing the emtire breakdown

BASE FARE TAXES/FEES/CHARGES TOTAL
1- USD633.00 657.50XT USD1290.50ADT
XT 516.00YQ 35.40US 5.50YC 7.00XY
5.00XA 11.20AY 24.60FR 33.90QX
5.40IZ 13.50XF
633.00 657.50 1290.50TTL
ADT-01 SLW27NCE
TPA UA X/WAS UA PAR316.50UA X/EWR UA TPA316.50NUC633.00
END ROE1.00 XFTPA4.5IAD4.5EWR4.5
NONREF/0VALUAFTDPT/CHGFEE
VALIDATING CARRIER - UA
BAG ALLOWANCE -TPACDG-01P/UA/EACH PIECE UP TO 50 POUNDS/23
KILOGRAMS AND UP TO 62 LINEAR INCHES/158 LINEAR CENTIMETERS
2NDCHECKED BAG FEE-TPACDG-USD100.00/UA/UP TO 50 POUNDS/23 KILOG
RAMS AND UP TO 62 LINEAR INCHES/158 LINEAR CENTIMETERS**
BAG ALLOWANCE -CDGTPA-01P/UA/EACH PIECE UP TO 50 POUNDS/23
KILOGRAMS AND UP TO 62 LINEAR INCHES/158 LINEAR CENTIMETERS
2NDCHECKED BAG FEE-CDGTPA-USD100.00/UA/UP TO 50 POUNDS/23 KILOG‡

Quote: vendman1

This type of thing bugs me. If I have a 100$ bill at a restaurant and tip $20. That's a good tip. But some places have 10-12% or more in restaurant/sales taxes. So that 100 check becomes say 112 after taxes. Should I tip $20 or $21.20 to tip 20%? The answer to me is obviously $20 why the f**k am I tipping on the sales tax? Not everyone sees it that way.

I always base tips on before tax and before discount (unless it's one of those vases where you're assumed to have a discount) prices, and anything alcoholic is calculated at a different rate. Drives the rest of my party mad, usually. I've noticed that, at most places, if they print the quick 15/18/20% reference, it's based on after-tax values.