Back in the days when everybody paid for a campsite with cash, people wanted to round off the numbers to a nice even number. So you didn’t have to have a lot of change. So they would include tax in the price so that the end result came up to a round number.
Do yourself a favor, and don’t count yourself short by doing this. The human brain compares the price after tax to someone else’s before-tax price. So you automatically are going to be five to 10% higher, depending on your sales tax rate if you include tax in your price. We have computers and calculators, all things are automatic now, and people expect to pay tax on their purchases, so they’re not surprised by it.
So do yourself a favor and don’t include sales tax in your pricing. Just include the base price and add the sales or occupancy taxes after. Make sure that your pricing is comparable to others and that you’re not giving your competition an edge by making your price higher than it appears to be.
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Donna Bordeaux, CPA with Campground Accounting
What happens when you send two CPAs out into the relaxing outdoors to camp? You get CampgroundAccounting.com. Donna and Chad have over 50 years of combined experience as entrepreneurial CPAs. They’ve owned businesses and helped business owners exceed their wildest dreams. They camp and travel across the country every chance they get, so it’s just a natural fit that they focus their CPA skills on helping campground owners throughout the USA grow their businesses and minimize the impact of taxes. They understand the key performance indicators and specialized issues that face RV park owners every day.