Why am I being taxed on the price before taxes?

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  • Updated 3 weeks ago
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I have a $60 plan in which I receive a $10 discount for byod. I'm new to Koodo and I noticed on this bill that the HST tax says "7.80" (I live in Ontario, it's 13%.) so what's happening is I'm being charged tax for $60 instead of $50 which should be $6.50. The same thing happens on my previous bill. Have you guys noticed this? Is this normal?
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Kristen

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  • confused

Posted 1 year ago

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Robert, Mobile Master

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Hello Kristen,

The discount will be applied on your 2-3rd bill from Koodo. So the first 2-3 months you'll be paying 60$/month
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Kristen

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Thanks Robert, I mad e a mistake in the title. I'm getting a discount of ten dollars but the amount being taxed is from $60 and not $50.
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Robert, Mobile Master

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Well if yo already have the discount, then I think the amount of taxes apply to the amount before the discount. So it goes bill > taxes > discount... That's the only logical explanation.
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Timo Tuokkola, Mobile Master

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The credit koodo is offering is a rebate of $10 a month. This means that whatever the cost of your bill comes to, they give you $10 back. The credit is applied to the total bill, not to the pre-tax amount, therefore tax would still be charged for the full amount.
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Andrea

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To piggy back on this question, I have a friends and family discount on my plan, and for the past year I've been paying the discounted price plus HST of discounted price.  On the most current bill, I was charged regular price + HST of regular price minus EPP discount.  Why did that change?
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Olga Y

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I appreciate the response but don’t understand how this article is relevant to the conversation, as the article is about reporting employee merchandise discounts as taxable income.
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srlawren

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@Olga the difference is this isn't being treated as a sale, it's being treated as a rebate.  If you were to buy a $100 item at Best Buy that has a $20 rebate, they are going to calculate your $100+tax amount and then apply the $20 rebate.  
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Mats

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Plus, why blame Koodo. They dont get any of the tax so why would they charge more unless they didn't have to.
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Olga Y

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@Mats-you’re the only one laying blame here. The inquiry is a Q/A type of discussion.