Nine West Overcharges You Because Calculating Taxes Is Hard

Nine West wasn’t sure how much tax to charge Jane for her online order so they have gave her a price that was $5.48 less than what they actually charged. When Jane wrote in to complain and to ask for her money back, Nine West explained that it was impossible to instantly calculate how much tax to charge because they use two highly-sophisticated tax gizmos that simply can’t interface with their online store. Jane wants to know if Nine West’s charges are ethical and whether it’s worth complaining over six bucks.

Jane sent us her correspondence with Nine West:

To Whom It May Concern:

On order number E5449228 I was overcharged $5.48. My order confirmation states that the total with tax and free shipping is $214.46.

I was charged:
$55.11 on 2/10/09
$66.13 on 2/10/09
$99.30 on 2/6/09

That comes to $220.54, which is $5.48 more than stated in the confirmation email. Could you please help refund this to my card ASAP?

I’d like to say, too, that it seriously concerns me that you charged more than the amount I’d authorized. This is the type of thing that’d make me think twice before ordering from you again.

Thank you for your help on this matter.

Nine West responded:

Thank you for your e-mail. I have checked on your order and I see that your order total is as follows:

Total Product $ 199.96
Sales Tax 20.49
UPS GROUND .00
Total for order is: 220.45

When placing your online order, on your checkout page you will see that we indicate the sales tax amount as being an approximate rate. Once your order is submitted, we pass it through two separate tax verification systems to ensure that you are charged the correct tax amount for your county. I’m very sorry if we have caused you any concern and please let me know if I can be of further assistance.

Jane replied:

Thank you for the clarification. I understand where you’re coming from, but this seems like a poor business practice for a well-established company like Nine West. Shopping online should be as easy and surprise-free as shopping in your bricks and mortar locations. I’ve never had another company give a total at checkout that turned out to be inaccurate. At no point before it showed up on my credit card statement was I told that there would be an additional charge. The confirmation email did not indicate that the total was not final or could possibly change.

If Nine West is able to offer their collection for sale on the internet, they should be able to accurately calculate taxes. Consumers should never be surprised with extra charges. Stores that can only provide approximate charges are obligated to receive permission before charging any more than the authorized amount.

Don’t waste your time convincing Nine West that they’re wrong. Send your confirmation receipt to your credit card company and let Nine West eat the chargeback.

(Photo: saturnism)

Comments

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  1. dragonfire81 says:

    Calculating tax should be a case of simple math, no highly sophisticated gizmos needed. This company has a problem here.

    • Anonymous says:

      @dragonfire81: “Calculating tax should be a case of simple math, no highly sophisticated gizmos needed. This company has a problem here.”

      As others have commented later in this thread, it is not as trivial as you suggest. Sales tax rates vary, as you undoubtedly know, by state, but they also vary by county, city and special taxing district. I work with Accounts Receivables systems and tax calculation is complicated, based on the customer address. It can vary by ZIP code and even by street address within ZIP code. In addition, some districts have additional rules, such as a cap on total sales tax that can be charged on a shipped order.

      The software that performs the calculation is clearly attached to their billing system, so it calculates in conformance with all the regulations, but this vendor has only attached a simple software solution to their web site, perhaps to save money.

      The net result is the difference between quoted and actual that the OP observed. If I were the IT manager or the AR manager at Nine West, I wouldn’t accept this because of the negative impact on customer perceptions, as witnessed here. Putting a disclaimer on the web page is better than nothing, but still not good enough. Other web sites get it right, why do they chose to do it wrong?

      Vertex: http://www.vertexinc.com//solutions/indirect/calc-engines.asp

    • Michael Chepul says:

      @dragonfire81: It’s a case of simple math up until the point where each county in a state has different amounts of sales tax. I know most online retailers give a tax estimate when you submit the order and you only get the EXACT tax when an order ships. I have worked for two major online retailers and know that things work exactly the same there. I think they usually try to overestimate, but I have seen situations where the actual tax for your county is higher than the estimated tax based on your zip code.

      • mythago says:

        @Michael Chepul: When you put in your address, the retailer knows what county you’re in, so what’s the problem?

        • bwcbwc says:

          @mythago: It isn’t the math that’s the problem. It’s paying through the nose to some data service to provide you the database required to maintain all of the city and county taxes and keep them up to date as laws change. Probably they have a limited license to use that data in one of their systems, but they aren’t willing to pay the fees to be able to use the data in their online system and display it to the public. And those fees could be considerably higher if the data company decides to license on the basis that each customer is a unique user of the data.

    • WOPDingo says:

      @dragonfire81: You’re completely right. I may not be into mid-life yet, but I remember a time, way back when – in the 80s and 90s – when tax rates were easily looked up on a system of tubes, called the Internet, and a calculator was MORE than sufficient for tabulating the complete, post tax, sales total. I don’t know if we should blame Nine West for making their employees succumb to the dumbing-down of America or what. But I DO sure as Hell know that it shouldn’t require TWO “tax verification programs” to do some simple, 7th grade percentage calculating.

    • Anonymous says:

      @dragonfire81:
      It should be a simple matter of math. But we are talking tax here, not math. Calculating tax isn’t like calculating shipping.

      I actually write systems that do this. EVERYONE has this issue, Nine West is guilty of not doing what everyone else figured out long ago, which is to give customers the worst case scenario at the cart and then charge the corrected amount when you settle.

      Some states like New York are horrible. You can have a customer that you have to calculate city, county and state tax. Multiply that across a the country and you need a system that will keep track of what taxes changed today and what ones change tomorrow. ie did this city start charging tax on food items; did this one stop taxing clothes; are we in a tax amnesty in Florida because of hurricane season?

      The software that tracks taxes and are available online are expensive. At least the good ones are. Since most web sites that have physical stores are already paying for that on a mainframe or other enterprise system, you have problems getting the bean counters to pay for a separate system online.Since the online system may have a different value than your enterprise because they updated at a different time of day you still end up with discrepancies. Seriously. You placed your order at 10pm, they settle at 12:01am and guess what? Your state has a new sales tax, which way do you go?

      So, generally you figure out what the worst case tax that state has and preauthorize amount when you hit the card. That is the charge you see when you first place the order. Then you charge the correct amount when you settle.

      I’m willing to bet just about everyone has seen a lower charge on their bill from an online retailer. That’s the taxes being adjusted just about everytime.

      Nine West’s guilty of going the other way or they updated their tax system between the order coming in and settling.

      It’s not a great system, but until the government steps in and says “you pay the sales tax in the location of the company” this will be how it is done on a lot of sites. I’d MUCH rather do it by local laws.

  2. nakedscience says:

    It’s worth it, because while it’s only $6 for YOU, it could easily be higher for someone else, and they need to fix it. This is not rocket science. Tax where I live is 8.3%. So if you have a purchase of $124.69, tax is $10.35, making the total $135.04, AND I SUCK AT MATH!

  3. pecan 3.14159265 says:

    Yeah, it’s as simple as calculating tax based on state. I guess I’m never going to shop at ninewest.com.

    • Yossarian says:

      @pecan 3.14159265: Apple, for example, didn’t calculate sales tax based on my state but on my particular local sales tax rate, so I don’t think it is necessarily as easy as charging based on state.

      That being said, Apple was able to figure out the amount in real time. Perhaps Nine West could ask them for advice.

    • UX4themasses says:

      @pecan 3.14159265: Unfortunately, this is wrong.

      Sales tax can be done at the county level (and is in Chicago area). Chicago alone, not the state, has the nations HIGHEST sales tax (arguably). This was done through the COUNTY.

      What’s funny is that this is an issue with Nine West cutting their IT budget and not caring. This is a simple fix that is commonly implemented (Apple, on checkout, asks for my COUNTY to verify Tax).

      This is pure laziness on NW’s part. Some VP has decided that the resources to fix this and the cost to fix is just not worth it to him/her.

      • Roy Hobbs says:

        @UX4themasses: Wrong. Sales tax can be calculated at the county level in SOME states, but not ALL states.

        In Washington State, it is done at the city level, and even within that, there are variations depending on the zip+4 code. When you add in the fact that many customers do not know their zip+4 code, and that address verification services are not as good as their advertising would have you believe, you have the recipe for a situation like the OP described.

        This is not as easy as it would seem, people.

        • edwardso says:

          @Roy Hobbs: If it’s not that easy why are so many retailers getting it right?

          • Roy Hobbs says:

            @edwardso: Who says they are getting it right?

            In this case, the only reason that the OP realized there was a problem was that after the order shipped, it went through two separate tax verification systems before she was charged the extra amount.

            My experience is that most companies charging tax on internet purchases are simply getting close enough (i.e. county level, perhaps), rather than going through all the crap that it takes to get it really, really right.

        • floraposte says:

          @Roy Hobbs: It’s all calculable from zip code, and city and county don’t matter if the vendor isn’t also in that city or county. It’s really not that complicated, and most online merchants calculate tax just fine.

          • madanthony says:

            @floraposte:

            Keep in mind that Nine West has a lot of B&M stores, so there is a very good chance that they have a physical presence in a lot of places, which makes it more complicated than a place that is just shipping out of one warehouse – they need to figure out if they have a store in that zip, and if so charge local taxes.

            Also, NY has gotten legislation through that if an online retailer has any affiliates that link to them that have a physical presence, they now have to pay taxes. Don’t know if any other states/counties have passed similar laws, but that complicates things even more.

          • feckingmorons says:

            @floraposte: That is incorrect. If a retailer has nexus (a presence) in a jurisdiction they are to collect tax based upon the customer’s location.

            Zip codes may cross county, and of course city lines. Calculating sales taxes based upon zip code is not accurate. Commercial databases have been developed to pinpoint the location of an address for many reasons including mail presorting, and just this instance sales tax collection.

            The retailer apparenty does not wish to calculate the tax prior to the sale and advises the customer that it is an estimate. The customer should know their local tax rate and be able to caluclate themselves if needed.

        • coren says:

          @Roy Hobbs: But in washington we’re talking fractions of a percent – on a 200 dollar order, 1 percent is 2 dollars. A fraction is noticeably less – the sales tax was off by at least two percent here.

        • DaBunny says:

          @Roy Hobbs: Sorry, I’m having a hard time buying that. Washington offers a look-up that only asks for address and 5-digit zip code. If you’ve got a good enough address to ship to, then you’ve likely got a good enough address to figure taxes.

          And this wasn’t just a tiny mistake. They bumped the tax by more than 35%! I think Washington taxes ranges from 8%-10%. So even if they’d guessed the lowest possible tax (a stupid thing to do…if you’re not sure, guess high) it’d be tough for it to jump that much.

      • LadySiren is murdering her kids with HFCS and processed cheese says:

        @UX4themasses: I envision some sort of populist revolt using the quarters that should be going into Chicago’s parking meters. Maybe NW will let Chicago residents pay the extra tax with quarters.

      • pecan 3.14159265 says:

        @UX4themasses: @Roy Hobbs: Well, I stand corrected. Sort of, since I’m sitting. I’ve never lived within a city limit, only the county limit, so my tax calculations have always been relatively simple…hmm..I’ll keep this in mind for the future.

        • Spectre1125 says:

          Silly Constitution and your state powers, causing all sorts of ruckus. Who’d of thought when money and the state was involved, particularly when it comes to taking it from consumers, there would be some sort of confusing gray area where nobody knows what the hell they are doing, but they still get the money.

          Sales tax is a state institution. You get charged a percent depending on your state, then you get charged a percent depending on what your county or city decides. I don’t think they do it off of your zip code, since that’s a post office thing, and if nothing else the state wouldn’t want to use it just because it is federal in nature.

          I can’t imagine that they could create logical “tax borders” and then have the tax vary from tax zone to tax zone. But I do believe that it is likely that places geographically close to each other also tend to have similar sales tax so long as they are in the same state. I would further go on to say that if the companies screw up and over or undercharge you 0.5% sales tax by following this “rule”, the company, the government, and yourself probably won’t notice, and at least two out of three won’t care even if they do.

          • cromartie says:

            @Spectre1125: Um, that’s not quite right.

            In Michigan, state law prevents local municipalities from charging their own sales tax ontop of state tax rates. There is one statewide sales tax, and this is 6%This I believe comes from the Headlee Amendment.

            In Ohio, on the other hand, you have a base state sales tax, county sales taxes, and local municipality taxes. In that example, the sales tax is zip code dependent.

            There is the base Ohio state tax, a Cuyahoga County sales tax on top of that, and a City of Cleveland sales tax on top of that, as an example.

            • Spectre1125 says:

              @cromartie: Again, very confusing stuff. I don’t think I’ve ever lived anywhere that I actually had a real “local” tax, but that of course doesn’t preclude it from being more common than that. lol.

              There are a few states that do it differently like you said, where there is only one sales tax. Most that I know of though do a split between the state and local (county/city/whatever) that is either capped at a certain percentage or simply never gets much higher than other states anyway. Every state handles it differently, so obviously there are going to be oddities here or there.

      • kc2idf says:

        @UX4themasses: There used to be a shopping mall in my area that very loudly proclaimed in their advertisements that the sales tax was only 4% as opposed to the tax in the other area malls, which was 7% at the time. The reason for this is that most of the malls were in Albany county, but this one mall was in neighbouring Schenectady County, which, at the time did not charge sales tax, hence, the 4% was the totality of New York State sales tax.

        Of course, those days are gone as is that mall. The tax structure changed near the end of the 80’s, and the mall was razed and replaced with a cluster of big boxes soemtime in the last ten years or so.

        Sales tax in both counties is now 8%. As far as I know, though, any county or city in New York State can charge whatever it wants; it is just that it is politically awkward not to follow the neighbouring counties.

        • Anonymous says:

          @everyone: So what we seem to be seeing is that yes, it *is* a lot more complicated than it seems.

          Some states tie local tax rates to zip codes. Some do it at the city level (which means Zip+4 in some case, and other things in other places). Some have county levels. Some have both. Some don’t do it at all.

          And after all that’s sorted out, it has to be reconciled against each state’s residency laws for businesses. Like NY, saying any company with affiliate marketers based in that state has to charge NY sales tax, local rates & all. Does Nine West actually have a location (or something that any particular state would consider a location) in that locale?

          To put it simply…there is no way to put it simply. The tax laws are a big ole’ mess, and anyone who’s ever tried to reconcile sales tax for an online company can see that. There’s no database with all the different rates in it – you have to plug in the rules on your own.

          After a cost-benefit analysis, it’s easy to see how it might take less man-hours to just farm it out to the appropriate local division and let them calculate the particulars. (Also, these things change all the time, so if you chose to try and automate you’d likely have to have a team of accountants and developers continually dedicated to updating the system.) It’s just not feasible, unless you’re happy with throwing money down the drain.

          FWIW, I think Apple only offers an estimate on their site, too.

  4. Anonymous says:

    Well, I would say it would depend on your actual sales tax liability. If in fact, your taxes were overcharged, then I would bring the issue up with the state comptrollers, I’m sure they’d be interested in any retailer overcharging taxes. If it’s a website glitch and the price that was quoted was lower than the expected tax amount, then it’s really piss poor website design by them, but not much you can do.

  5. hills says:

    Nine West should reimburse her – Just curious though, which tax is the right amount? The one she was originally quoted, or the tax amount that was charged?

    • I_am_Awesome says:

      Most jurisdictions require you to pay the tax, even if the retailer doesn’t collect it. They could let her pay the lower amount, but she still owes the tax.

    • feckingmorons says:

      @hillsrovey: I am of the impression that the customer has no idea how to calculate at what rate the tax was collected, so is unclear if it is correct or not.

      The customer wonders if it is ethical, and frankly that is absurd. Either the tax collected is correct or it is not. The retailer does not retain the tax they collect, they send it to the various jurisdictions for which it is collected.

      We do not know where Jane lives, but the tax rate paid can be easily calculated by dividing the tax collected, by the amount of the sale. In this case it is 10.25%.

      Either the customer lives in a jurisdiction with 10.25% sales tax, or she does not. If she does she does not deserve a refund, if she does not there is indeed an error in the calculation and she should be promptly refunded the difference.

      Prior to completing an order on the 9West site an address verification is performed as I tried it with a house number I know does not exist. There is an option that allows the user to correct her address, or check a box to opt out of address matching service. Since I don’t need women’s shoes I did not complete the order, but as far as I went in the process it suggests that there is a notice that based upon an unverified address the tax would be estimated.

  6. axiomatic says:

    Agreed. Every other online store I have ever shopped with gets this correct. I recommend firing your web developers Nine West. They clearly have no clue what they are doing.

  7. ChuckECheese says:

    It’s not always so easy to calculate taxes for online merchants, and here’s an example why.

    Living in the outskirts of Oklahoma City some years ago, I lived in a zip code that encompassed two counties, two cities and an unincorporated area. The sales tax rate in my county was 8.375%, but a few blocks away, in the unincorporated portion of the next county, the tax rate was 9.5%. There was a 3rd rate in the other town.

    The online merchant couldn’t determine what tax rate there was by municipality or by zip code. They would have to know on a streetwise, block-by-block basis what the tax rate was. So, the merchant (a check printing company) charged the higher rate to everybody.

    This must be an issue for many places where there are differing city and county tax rates.

    • edwardso says:

      @ChuckECheese: I live in Alexandria City and there is also an Alexandria in Fairfax County VA. When I make an online purchase usually something pops up and says “Alexandria City of Fairfax County”

    • floraposte says:

      @ChuckECheese: Now that’s interesting–I hadn’t heard of a locale wherein same zip codes would have different tax. However, unless your online merchant has a b&m presence there, it’s still not going to be an issue.

    • chrisjames says:

      @ChuckECheese: It’s sort of irrelevant here. The merchant was able to calculate the correct* tax rate and charged that amount. There’s little reason why they couldn’t have set up the online system to do the same calculation before the final verification at the time of purchase, instead of giving a bogus rate (estimated rate). The question is, why is it calculable at one point and not another?

      *This is assuming they calculated it correctly at this point, but that’s a fair assumption without more information.

  8. edwardso says:

    Does Nine West realize that they aren’t the only online vendor and that there are thousands (millions?) of other sites that have no problem figuring out tax at the time of purchase?

  9. scoosdad says:

    Cue the commenters chiming in with comments about local city, county, neighborhood, etc. taxes on top of the state tax. Not so simple, sometimes. They may have calculated the state tax for checkout purposes, but missed a specific local or city tax that applied to the buyer’s address and decided to try to collect that too.

    Not saying what they did or how they handled it was right, just saying.

  10. ShruggingGalt says:

    Actually, since they have retail stores, this is understandable. My state has cracked down on sales taxes, and there are different tax rates for the city, county, special taxing districts, etc. So it will come down to what the tax rate was to the closest store to the shipping address. The state made it clear recently that even shipments delivered outside of the special taxing districts have to be charged, so they probably got hit with back taxes, so they’re being overcautious.

    Even so, I would have just eaten the difference under good customer service.

  11. TCinIowa says:

    That’s why there should be no taxes on internet purchases, like Jesus intended.

  12. UnicornMaster says:

    I think the only mistake is the 9 West should not have estimated taxes and instead included a line stating “taxes will be calculated upon shipping” or something like that. It’s pretty standard for a lot of these online/brick&mortar retailers to do this. It’s because they have hundreds of stores, and the online website is not connected to their tax database. Are you really going to complain about the $6?

    • fjordtjie says:

      @DeanOfAllTrades: the issue (imho) is that they didn’t tell her what they would charge. it happened to be $6, but it could have been $100 more, and that is a serious thing. they should either a. update their tax calculation software and make it more specific (i.e. know the tax in her specific area rather than state) b. send her an email with the updated tax to let her know what will be charged and asking her to verify before processing the transaction c. send her an email to let her know the specific amount of money they ended up charging her for her official record

      i guess to sum up, she should know exactly how much she’s getting charged from them, not afterward from her credit card bill?

      • coren says:

        @fjordtjie: C isn’t acceptable because it’s a change after the fact

        • fjordtjie says:

          @coren: but they did have the *approximate tax warning, so i think it’s acceptable to change the tax to her area. as a resident of madison, sales tax on anything from nine west is going to be 5.5%. if the website estimates it to be 5% and says it’s approximate, i know the amount they are going to charge me even if it’s not the amount estimated. the fact that they clearly state it’s approximate, makes it fine by me, but maybe that’s just me.

    • nakedscience says:

      @DeanOfAllTrades: Yes, she’s really going to complaina bout the $6, because this is an easily fixed problem and ignoring it won’t get it foxed. Yes, sometimes complaining about “only $6″ is worth it.

  13. Roy Hobbs says:

    As someone who actually grapples with this question as part of my job – Consumerist, you are absolutely wrong. Another poster pointed this out – the multiple tax jurisdictions within every state make it nearly impossible to figure out what the correct tax rate is with any certainty.

    Until the states come up with a streamlined tax code, you will get this kind of problem, and it is only going to grow larger.

    • Etoiles says:

      @Roy Hobbs: As someone who actually grapples with this question as part of my job – Consumerist, you are absolutely wrong. Another poster pointed this out – the multiple tax jurisdictions within every state make it nearly impossible to figure out what the correct tax rate is with any certainty.

      Wouldn’t they have some kind of database that associates ZIP code with tax code? Presumably, there are several B2B companies out there in the world that provide, license, and maintain just such databases of basic information. And presumably part of running a large-scale online business is using such databases.

    • floraposte says:

      @Roy Hobbs: This doesn’t make any sense. They did calculate her tax to what’s presumably certainty. They just did it later. Other merchants do it at the same time as the order. What makes Nine West different from Victoria’s Secret, Barnes and Noble, or any other online merchant with multiple brick and mortar entities and thus multiple flavors of tax obligation?

      • Roy Hobbs says:

        @floraposte: If you have a brick and mortar store, calculating the tax is straightforward, because you presumably know exactly where your own store is located.

        However, when you rely on the customer to tell you where they are, especially when dealing with multiple taxing authorities, you are asking for a world of hurt.

        And not to get on too much of a political rant here, but stuff like this is why dealing with the government drives me bananas sometimes. Rather than creating a sales tax system that is reasonable to understand and implement, there are an insanely complex set of rules for every single transaction that are nearly impossible to deal with.

        Clearly, the founders could not have anticipated the internet, but this is one of the reasons for the Interstate Commerce Clause in the Constitution, inconvenient though it might be for states that want to raise more revenue.

        • floraposte says:

          @Roy Hobbs: You misunderstand me. The tax the online merchant charges is based on the location of their brick and mortar stores. Nine West doesn’t charge you tax if they don’t have any stores in your state. They don’t charge you county tax if they don’t have any stores in your county. They don’t charge you city tax if they don’t have any stores in your city.

          While Zappo’s, for instance, is only a b&m business entity in Nevada and Kentucky, so doesn’t have to worry about tax in 47 other states (NY collects tax anyway), Nine West has quite a few brick and mortar stores, probably well over 100, across the country. So their online tax calculations are more complicated because of that. But they’re not more complicated than the online branches of Victoria’s Secret, Gap, Barnes and Noble, etc., which also have hundreds of brick and mortar locations and which consequently also have a ton of tax possibilities for online customers, yet which manage to provide those customers with their tax charges along with their order charges.

          I get the point you’re making about the complication of the multiple tax codes, but that really doesn’t seem to have been Nine West’s issue, since it’s been solved by so many other merchants. The question isn’t “Why are taxes hard?”, it’s “Why is Nine West unable to solve a problem that so many other merchants have solved?”

  14. Geekybiker says:

    I’ve literally never had this happen with any retailer on the net. Nine west must have decided they were big enough not to use a payment service like the small guys, but too cheap to pay out for the many tax packages that *can* get this right. Its not hard, there are turnkey solutions for this exact problem.

  15. great_equalizer says:

    I run my own online store, much simpler than ninewests. It is simple, you put in the tax rate for each state. at checkout it adds it. nothing complex. most shopping cards come with it prefigured. and you only have to charge tax if its being sold within the same state (unless you operate in that state also).

    • scoosdad says:

      @great_equalizer: So you collect state tax but ignore collecting all the various city, county and other local sales taxes in locations that have multiples? That’s more common now than ever before.

      Hope you have a big savings account stashed away somewhere to pay that bill when it comes due.

  16. MBEmom says:

    How dumb is this. Yes, this is a big deal and she should complain if for no other reason than this is standard operating procedure. It’s probably happened on many occasions and will continue to happen. Just because people may not have noticed or thought it wasn’t worth the trouble for a few bucks doesn’t make it ok.

    Everyone on this site shops online all the time. Has anyone ever encountered this with another company? I never have. Why should Nine West get off with the “we are too lazy and stupid to fix it” excuse if everyone else manages to get it right?

  17. rpm773 says:

    It’s 2009. People have been buying stuff on the information superhighway for nigh on 15 years. Get with the program, Nine West.

    Sure, internet sales tax is a new phenomenon, but it’s not impossible to figure out state, county, and city sales tax. If the OP had gone to her local store, it’s probable she would have been charged the correct tax amount. If Nine West can figure it out at the store level, why can’t it do it on its website?

    • MattMcDermott says:

      @rpm773: The sales tax is calculated based on where the purchase took place. When you go to a brick and mortar store, that location never changes so it’s a fixed tax rate and very easy to calculate. If a company makes a 100 sales on the internet to customers there might be a 100 different tax rates when you take into account the state/local splits at each customers home address. I’m not saying they handled this particular issue in a customer friendly manner, but it’s not nearly as easy as you imply.

    • ludwigk says:

      @Rectilinear Propagation: If the final charge is correct, then there is no ‘additional charge’, its simply that the prior estimate was wrong, in which case, there is no need for refund. As long as Nine West charged the correct amount for their merchandise, they’re most likely in the clear here. They even state that the order confirmation is an approximate charge.

      What is likely the case here is that the “estimate” is based on state sales tax data (easy to calculate), then at the last minute, they send the order details to a middleware that calculates exact county data based on street address (more complicated). If this is a paid service (i.e. by the query), then they don’t want to use this until the order is getting placed, since they could incur multiple hits if people change their cart or shipping settings, or whatever.

      Here in California, we have stupid-hard sales tax since it does vary by county by up to about .75%. Whats worse is if you buy something from a store in San Fran, then return it in Oakland, it creates a discrepancy between the sell and refund pricing, throwing off your till.

  18. Cyclokitty says:

    Well before everyone and their maiden aunt had a computer, people learned how to calculate percentages on paper with a pencil in grade 5.

    A nationwide chain should have zero problem calculating the correct sales tax for online purchases. Not rocket science — grade 5 math question, NineWest.

    • NeverLetMeDown says:

      @Cyclokitty:

      The issue isn’t doing the Y*(1+X) calculation (where Y is purchase price, and X is the tax rate), but rather determining what X is.

    • Anonymous says:

      @Cyclokitty: Sales tax for an online sale is usually done based on the “deliver to” address. And the problem is not just “look up tax for the county”. With in a county (which can cross zip codes) there can (and are) special tax districts. In some cases there is one tax rate on the west side of a street and another on the east side because of these things. Also, many areas have multiple different tax rates, so for example electronically delivered software isn’t taxed, a training course is taxed at the standard rate, a physical item is taxed at some rate, and the delivery charge is taxed at a portion of the standard rate.

      Doing nationwide sales tax correctly is difficult even if you have an absolutely up to date geo-location tax type system. You still need to account for what you are actually selling particularly if you are selling both physical and digital products. Over charging someone tax and not returning it may be very legally dubious. And consistently under charging and eating the cost can be a problem as well for book keeping.

      If ninewest has a disclaimer I’d say they are pretty much in the right on this issue. Probably not the most consumer friendly way to handle it, but anyone who claims online sales tax is simple simply doesn’t know what they are talking about.

  19. wcnghj says:

    Chargeback, they should learn.

  20. Etoiles says:

    I’m really, really crap at math — failed-precalc-the-first-try crap — but even I can calculate sales tax. With a pocket calculator. Or with some paper and a pen. And I’m pretty dang sure that a major national company with a top-notch website has more than a pen and paper at their disposal.

    • ajlei says:

      @Etoiles: Hahah, I think some would argue your claim of being “really, really crap at math” if you even got to the point where you were taking pre-calc. I know too many people who are stuck in that Math 20-60 region that I’ve ended up tutoring. So I wouldn’t say you’re too horrible.

  21. Rectilinear Propagation says:

    Can anyone straighten out the contradicting statements here?
    The company says When placing your online order, on your checkout page you will see that we indicate the sales tax amount as being an approximate rate.
    But the OP says At no point before it showed up on my credit card statement was I told that there would be an additional charge.

    Who’s right?

    As for the difficulty in calculating taxes, does it even matter how hard it is?

    • WOPDingo says:

      @Rectilinear Propagation: It’s kind of like when you order flowers for someone from an online retailer. They give you a general subtotal for the purchase before they calculate delivery charges, which are higher depending on where you need to have them delivered, naturally. So, it’s possible Nine West has the same sort of pre-payment page where an “almost-complete” sales total is displayed. I’m not doubting there’s some incredibly-small-font-typed statement about the inaccuracy of the total pre-tax-calculation, but there should still be a final page where you confirm the complete post-tax total prior to charging the CC. Now, I’m not a lady and have no penchant for buying lady things, shoes included, so I’ve never been to Nine West’s site. Now, if the OP just assumed the two totals would be the same and clicked “OK” then she’s in the wrong. However, if Nine West just laid out the blanket statement of “Well, this is potentially what your final total will be, but you won’t know until you see the charge on your card,” then they’re REALLY in the wrong.

      Hope that helps a little bit. And I apologize for the lengthy diatribe.

  22. fantomesq says:

    This is only going to be an issue with those who live in zip codes that overlap county borders. My zip code overlaps LA and Orange Counties (which are half a cent different). Every retailer I have dealt with has either figured it out (note: phone area codes can help determine counties) or asked (Apple asks) and applied the correct tax.

    If the tax rate that was ultimately applied was correct then the OP does not have a claim for return of the $6 because tax rate is mandated by the state/county but as others have noted estimating the tax incorrectly is inexcusable for anything more than a Mom & Pop shop. Really Nine West? How much bad publicity can $6 buy you?

    • Herbz says:

      @fantomesq:

      I don’t think the issue here is the actual $6. It may be correct that she owed $6.

      The problem is that they quoted her one value (which she approved) and then charged her another value (which she did not approve). That is the issue at hand, and the reason why people are saying that she should do a chargeback.

      • ludwigk says:

        @Herbz: If you approve an estimate, that usually means that you approve some variance from said estimate as well. A charge-back isn’t appropriate, but if she feels strongly about it, she should return the shoes for a refund.

  23. prag says:

    Where does one have to live to get charged 10.25% sales tax as implied by Jane’s bill above? I thought NYC was bad…

  24. surgio says:

    I work for Staples and its the same with our Internet ordering. But it specifically says that tax listed online is an estimate and when you get an email confirmation that is the exact tax

  25. pecan 3.14159265 says:

    I would have more problem with the sales tax being wrong and people not noticing.

  26. rhys1882 says:

    Sounds like lazy programming. It is kinda annoying that every county, not just every state, charges a different tax rate. I worked at a store that shipped products throughout California, however we charged everyone the San Francisco county rate for tax. Occasionally we would get a complaint from someone about the fact that their county’s tax rate was like 0.25% or 0.5% lower then SF county’s. It was a bit of an inconvenience because we just used old fashioned adding machines for everything, so their wasn’t an easy way to calculate different tax rates. Sounds like their initial calculator is based on a set rate and doesn’t have the individual rates for each county. If they put a decent disclaimer on the checkout page they would probably be in the clear.

  27. cpaforrent says:

    As a CPA, I can tell you that sales taxes are pretty complicated animals. I have a client with operations in Nebraska and the sales tax structure there is enough to make even an accountant’s head explode.

    It’s not uncommon at all for online vendors to use multiple sales tax systems to ensure accuracy. I’m not sure though why it can’t be run through in real time during the checkout process and before processing the card….

  28. shepd says:

    This is illegal. Once the store has accepted an offer from you (in this case for $214.46 including tax) they cannot change their mind.

    Contact the local police/AG/crown or whoever deals with this in your area. If they won’t do anything about it, it is worth it to take them to small claims so they stop this, since this seems to be something they do to all their customers.

    Anyone who runs a store knows the bucks stops at the cash register. Once you tell the customer the price and they hand you the money (or credit card, in this case) you must make good on your offer. You can argue things aren’t stickered properly, or you won’t accept coupons, or whatever else BEFORE you ring it up. Once you’ve accepted the money/card, that’s it. Done deal.

    The only possible way to “make it right” is to refund the difference. The only way to sleaze out of this is to offer her a full refund and send her a pre-paid reverse shipping box for the item.

    Anything else is (literally) criminal.

    Just because it is hard doesn’t mean you can get away with breaking the law. I find it a pain in the ass to walk across a full parking lot despite there being a handicapped space right next to the door. Do I get to park there? No. This is software. NOTHING is impossible with software (*).

    (*) – Except maybe stuff that hasn’t been invented yet. I can assure you the idea of integrating taxes into your software has existed since computers started accepting credit cards (and before).

    If they are too lazy to update the software, the only way I can see them getting away with using their current lame-ass system is to ensure they don’t include any tax in the price presented and that they always state “Appropriate tax for your area will be added to your bill at our discretion. THIS IS NOT A FINAL RECEIPT.” or something similar, sending the completed receipt with the goods in the box.

  29. cristiana says:

    Sales tax, does sound like an easy thing to calculate, all you have to do is multiply, right? Well, it’s not that easy

    Like other people said, taxes can vary from county to zip code, as well as just by state. But, another hard part is that at least in my area the sales tax rate changes constantly, so much so, that I only know the approximate rate. Also, in NYS they often have sales tax holidays that exclude certain items from sales tax, such as clothes and shoes (below a certain price). Then once you get all that information you can do the simple multiplication to get the final sales tax result.

    It’s similar to some other ‘easy’ sounding things, for example, calculating the difference between two arbitrary dates. Well, that is far more complex than just converting all to days and subtracting, you have to account for leap years, leap seconds, and a bunch of other little things that I cannot remember.

    There are many other things in the computer science field that sound simple to the average person, but, a programmer has to think of every case and account for it, and it is often times that the simple things are quite complex.

    • shepd says:

      @cristiana:

      (Assuming you already have $sub_total, $county, $zip, and $state–which you should, since you have the mailing address already…)

      my $total = $sub_total;

      for my $tax_rate (@{$dbh->selectcol_arrayref(“SELECT DISTINCT tax_rate FROM tax_tables WHERE county LIKE ” . $dbh->quote($county) . ” OR zip = ” . $dbh->quote($zip) . ” OR state_short IN (SELECT short FROM states WHERE state LIKE ” . $dbh->quote($state) . “);”)}) {

      $total += $tax_rate * $sub_total;

      }

      No, that is not hard. Just do it already. I don’t believe the US has pyramid taxes (do they?). If they did, then you’d just need a few minor tweaks. Nothing all that hard for anyone that calls themselves a web developer.

  30. missy070203 says:

    In my state its up to me when I file my taxes to report any online purchases from states/counties with a lower sales tax….. apparently nine west has a tax gizmo that calculates your tax based on where you live to take away the consumers right to use the honor system when making claims on their taxes….hmmmm…. sounds like they just made things more complicated for themselves by trying to “go the extra mile”

  31. Anonymous says:

    Buy your Nine West shoes through Zappos. They have no issues with tax calculations. The price they quote is the price you pay. Though sometimes you’ll find a surprise; for example, you’re charged *less* because the price dropped during the fulfillment stage.

  32. John Tobe says:

    Maybe Nine West and other online retailers should only collect sales taxes for the states they operate out of then? And those localities “losing out” on sales tax revenue they “should” get can figure out a more reasonable way of collecting revenue?

  33. Mister-e Tarot says:

    I did some research here for the OP.

    After that stoopid response from Nine West, my next communique would have been to the local, state and federal tax authorities to perform an audit :) Not to mention the Attorney General’s Consumer Protection office in the states where OP lives and where Nine West is Headquartered.

    Now this is just my personal approach as a consumer with a brain and a spine. It may not be for everyone, OP and others do as you wish. I just believe in being thorough, direct, unstoppable and teaching corporate tax cheats a lesson. See, I kind of, well, pay my taxes every year, and pay accurately, so why the frick shouldn’t Nine West?

    Their parent company is:
    Jones Apparel Group, Inc.
    180 Rittenhouse Circle
    Bristol, PA 19007
    [www.jonesapparel.com]

    And how sneaky, when you try to get more facts about them on their own website, you get – page could not be displayed.

    No matter. Thanks to Google, corporate phone for JAG, Inc. is (215) 785-4000.

    Board of directors names here: [www.jonesapparel.com]

    Lowell W. Robinson is their Chief Financial Officer, this ball should fall squarely in his court, you might want to mention his name when requesting the IRS audit :)

    Pennsylvania AG’s office file a complaint here: [www.attorneygeneral.gov]

    Penn IRS offices to call and report them: [www.irs.gov]

    Not sure which one is closest to Bristol, but if you call any of them, sure they will route you.

    Generally speaking, if a business is cheating customers on taxes, it’s fair to check if they are cheating the government too, and I’ll bet money errors are not in the consumer’s or government’s favor IMO.

    Good luck! :)

  34. hicks says:

    My company has struggled with this regional sales-tax issue as well, and while it seems to easy to fix on its face, it is a highly complicated mess to charge everyone the correct tax, especially when irregular rate areas change rates on an irregular basis. Mind you, the clients we’ve built e-commerce sites for are businesses that get maybe a thousand orders per year, which means they don’t have a ton to spend on development time to get it perfect.

    But I’d expect a larger company like Nine West to be able (though perhaps not willing) to spend the extra money to make sure it works correctly 99.9% of the time.

  35. Anonymous says:

    Even if Nine West should have charged her $220.45 as they said in their followup email, why did they charge her $220.54? Sure, that’s just an extra 9 cents, but it’s not the right amount. How hard is it to charge someone the exact right amount?

  36. Anonymous says:

    The fact that they couldn’t accurately determine sales tax during the order is not unusual; as other commenters have noted, sales tax jurisdictions can be really tricky. The problem in this situation is that they did not send her a new confirmation once the correct total was determined. They simply charged the new amount and let her find out on her own. That’s bad business practice, period.

  37. Anonymous says:

    Apparently Jane is not that good at math either because $220.56 is $6.08 more than $214.46, not $5.48 that she stated earlier.

  38. Poshua says:

    Nine West’s obligation to collect taxes is determined by the states in which it has a B&M presence. However, once it has a presence in the state, it must collect taxes for all the county, city and other taxing jurisdictions to which it might ship within the state– even though it only has stores in a small fraction of those jurisdictions, and does not comply with their sales taxes in the course of B&M sales. This is not a small order, as there are over 8,000 sales taxing jurisdictions in the country, and those taxing districts do not necessarily align with zip codes, or even zip+4 codes.

  39. mythago says:

    So they can calculate it at the time of shipment, but not the time of purchase?

  40. PsiCop says:

    Uh … like … if they could run the transaction through these two fancy, complicated tax-verifying gizmos at the time the item was shipped, couldn’t they have done it at the time of sale?

    Just wondering how it could be available at one moment but not another.

  41. Meathamper says:

    I’m sure math is hard… that’s why we have calculators.

  42. Bs Baldwin says:

    This makes no sense, before you place your order the website figures out the cost of shipping and taxes. You confirm that amount and authorize the sale.

    I had best buy to pull something like this on me before. I ordered an external HD near me (I live in Del) and they had it in stock; I got an e-mail confirming the purchase. I got an e-mail 1/2 later telling me that the HD was now not in stock. I called them up, and somehow the rest of the state didn’t have this HD anymore in stock. I get the rep to change the pick up to a NJ store. I pick up the HD in NJ, price on my receipt is the same as on-line. I look at my statement a couple of days later and there is an additional $10 charge from BB. I e-mail them and they tell me it is for sales tax. After explaining that no one told me about this (rep on the phone, kid at the store), I shouldn’t be charged. They reversed the charge.

    Nine West screwed up, fight it.

  43. Anonymous says:

    $6 is not worth it…opportunity cost people. Just think how productive everyone that has already commented on this article could have been in the mean time? Things like this should be dealt with on a case by case basis and this certainly isn’t one of them.

  44. MooseOfReason says:

    Did she really spend $200 on shoes and/or handbags?

  45. Anonymous says:

    There is NO resource available that shows all the rates ALL the time by zip-code. You have to manually go by shipping zip code/city, then get the county, and then get the rate for that city and county (yes, they do vary within the same county). In California if you look up the rates too many times during the day, your IP address is locked. I know this because we ship all throughout CA and are constantly temporarily blocked by the .gov website for excessive website usage. A government sponsored API for Tax calculations based upon product classification and purchase date is the only way to remedy this and I am quite surprised that it does not exist, or at least we have not found it. Calculating taxes should not be as hard as it is, but unless you have had to do it yourself, for more than just yourself, you would never know it. Is it the business owners responsibility to create the program to calculate tax for the web? How will it be updated? At least the tax was collected for the lady complaining. Most sites don’t charge tax at all, which can be a competitive advantage for them, despite it being theft. So, I say, pay your taxes, accept the estimate, and shut up. If you have overpaid when the final receipt arrives, then say something. If you’re concerned about paying the exact amount of tax at that exact instance, do the calculation yourself. Otherwise, drive into the store and buy it in person. And if you think collecting it is annoying… try paying it! According to SBOE, when calculating how to pay counties they discourage using software like excel because it is prone to errors and can not account for all the variances. A little example how government is not concerned about the obvious inefficiencies that plague all businesses that could be reconciled in about 1 month of a programmers time and some basic policy change.

  46. Anonymous says:

    As a web store operator for a small company with minimal resources – no clue regarding Nine West.

    Our sales taxes are NOT approximate, and we never need to make changes to billing – and we ship worldwide. It all balances at year end and after audits, too.

    Perhaps they should get rid of lazy programmers and hire someone with a bit more skills and dedication.

    This isn’t rocket science!

  47. Tank says:

    “have gave” ??? Really?

  48. edwardso says:

    I just bought some stuff from Kohls.com. They had an estimated tax rate, then asked if I was in independent or incorporated Alexandria and the next screen was the actual tax (about $.12 cheaper) It may have taken an extra step but they did it and now I don’t have to worry about suprises. Well done Kohls, boo nine west

  49. algorhythmic says:

    I had this same exact problem with BabyUniverse. I ordered a car seat from them. On the confirmation page, it said that the sales tax was an estimate and they’d charge the correct amount when the product actually shipped. When they shipped it, they overcharged me the wrong amount. I went back and forth with their customer service, and they refused to fix the problem.

  50. krunk4ever says:

    Nine West states the Estimated Tax during checkout as you can see from this screenshot.

    Many online stores state something similar. I know for a fact either Staples or Office Depot have the exact same clause, most likely due to county/local taxes can sometimes add additional taxes on top of state sales tax.

    Given that Nine West did in fact state this was estimated, I believe the buyer is in the wrong here for demanding a refund. Nine West could’ve done a better job about explaining what happens when the estimation is incorrect, but it’s not like Nine West is ripping off the buyer here. The extra money is sales tax she would’ve had to pay.

  51. Anonymous says:

    While I don’t mean to say Nine West is correct (they are not), the article is wrong about approximate charges. It is standard practice in many industries to give approximate charges, and only give the total after the product is shipped. I regularly buy engineering products from McMaster-Carr, who is probably the largest company in its business. At checkout, McMaster never gives shipping charges — they state shipping will be added once the product has shipped. To their credit, shipping is always reasonable, but you don’t find out until exactly what it is until your credit card is billed and they send an invoice.

    This is completely unreasonable behaviour for a consumer-oriented company, but it is quite legal, within the terms of credit card agreements, and for business-to-business, quite common.

  52. baristabrawl says:

    I guess if they’re doing it to you they’re doing it to a zillion people. CLASS ACTION!

    I’m going to go see if they have sling-backs in a 15 EEE. A man’s gotta do…

  53. redkamel says:

    why dont they just charge the rate of the location Nine West is located? thats where youre buying it from, you just arent actually there.