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I need to decide whether to show prices on a website with or without taxes.

At the moment our Product can be purchased for Rs.999. But we recently got a GST certificate and have to charge our customers 18% tax. I would like to know the best way to display the price of the product, the two ways that we can do this are either by:

  1. Showcasing the price as "Rs.999+18% GST" and show the final split up at the payment portal.
  2. Showcasing the price as "Rs.1200(Inclusive of all taxes)" and show the split up at the payment portal.

We don't want to lose out on potential customers because we are showcasing a high price nor do we want to lose them because we are showcasing the price exclusive of taxes.

We ran a poll at my office and we reached a split decision on the same.

Some people preferred the price to be displayed as "Rs.999+18% GST" because:

  1. They prefer to see how much the base price of the product was
  2. Some don't look into how much the tax amount is and only care about how much the product costs
  3. They are interested when they see the lower price

The other half chose "Rs.1200(Inclusive of all taxes)" because:

  1. They didn't need to calculate tax
  2. A clear-cut price is shown
  3. It's a round off value
  4. Some didn't want to see a split up and only wanted the final amount.

To give you all more perspective our target audience are final year college students and our company is based out of India.

What do you think is the best approach to this problem? Also I'm open to other solutions about how to go ahead with this issue.

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    Are there any requirements in Indian law or the law of your state regarding this? If so, start from conformance with the law. If it's entirely up to you, I'd say to go with something like **Rs999 + 18%GST (Rs180)".
    – Jeff Zeitlin
    Jul 20, 2018 at 11:52
  • Having said that, I'd consider this question a candidate for closure as primarily opinion-based.
    – Jeff Zeitlin
    Jul 20, 2018 at 11:53
  • @JeffZeitlin - I work with Karan on the same project and can confirm that there is no law about how the pricing should be represented. We are mostly worried about how clear our pricing is to the customer and if the customer would not like it a lot in case there is a change in the pricing or if the customer would be okay since the price increase is just for tax.
    – Michael Victor
    Jul 20, 2018 at 12:13
  • Separating the base price from the tax would (at least in the US) provide a graphic indication of just how much the state is skimming off the top; that potentially redirects any ire the customer experiences over the price rise toward the state, rather than toward you as the vendor. Beyond that, you'd have a better handle on the Indian psyche than I would.
    – Jeff Zeitlin
    Jul 20, 2018 at 12:21

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I am basing this on how the "best practices" are in Sweden.

Most e-commerce websites display including taxes for regular consumers and without taxes for B2B.

So I would suggest something similar: Make it toggleable whether to include taxes or not. Then always show both prices in the checkout / preview cart page.

Example

Excl. taxes: 100 Incl. taxes: 118 in a nice presentation.

Don't include both for each product, this would be too much information.

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In the details of the page, you can show both prices. Make sure you highlight the price that the user want to see based on the toggleable setting I mentioned.

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