How to Calculate a Discount: Percent Off and Sale Price
Sales events are designed to make you feel like you are getting a deal, but do you actually know how much you are saving? Understanding discount math protects you from misleading pricing and helps you compare offers from different stores objectively.
This guide walks through the formula for calculating a simple percentage discount, explains why stacked discounts are not as generous as they sound, and shows you how to factor in sales tax to find the true final price.
✨Key takeaways
- Sale Price = Original Price x (1 - Discount / 100).
- Stacked discounts are applied sequentially, NOT added together. 20% + 10% off = 28% total, not 30%.
- Always calculate discounts on the pre-tax price.
- Use the savings amount, not just the percentage, to evaluate whether a deal is worth it.
The single discount formula
To calculate a percentage off, multiply the original price by (1 minus the discount rate). A $200 pair of shoes at 30% off: $200 x (1 - 0.30) = $200 x 0.70 = $140. Your savings: $200 - $140 = $60.
An even faster shortcut: multiply the price by the discount rate to get the savings directly. $200 x 0.30 = $60 savings. Subtract from the original to get the sale price. Try the Discount Calculator for instant results.
Stacked discounts: why 20% + 10% does not equal 30%
Stores often advertise "Take an additional 10% off already-reduced items." This sounds like 30% off if the item was already 20% off, but the math tells a different story.
Start with a $100 item. First discount: 20% off = $80. Second discount: 10% off the reduced price = $80 x 0.10 = $8 off. Final price = $72. Total savings = $28, which is 28% — not 30%.
The more discounts you stack, the wider the gap between the "added percentages" and the actual savings. Always run the numbers through the Discount Calculator to see your true savings.
Worked example with tax
A $89.99 backpack is 25% off during a back-to-school sale, and your state has 7.25% sales tax. First discount: $89.99 x 0.25 = $22.50 savings. Sale price: $89.99 - $22.50 = $67.49.
Tax: $67.49 x 0.0725 = $4.89. Total out-of-pocket: $67.49 + $4.89 = $72.38. You saved $22.50 off the original price, but your final cost after tax is $72.38. The Sales Tax Calculator can verify this in seconds.
Common pricing tricks to watch for
Inflated original prices: some retailers raise prices before a "sale" so the discount percentage looks bigger. Compare the sale price against what you have seen the item sell for previously. Price-per-unit matters more than percentage off — 20% off a $50 item saves $10, while 10% off a $200 item saves $20.
BOGO (buy one get one free) is equivalent to 50% off when you buy two. If you only needed one, you are spending more, not saving more. Always ask: "Would I buy this at full price?" If the answer is no, the discount is not saving you anything.
Try the calculators referenced in this guide
Put the maths into practice — every calculator is free and runs entirely in your browser.
Frequently Asked Questions
How do I calculate the original price from a sale price?
Divide the sale price by (1 - discount/100). For example, if a $60 item is the result of a 25% discount: $60 / 0.75 = $80 original price.
Should I tip on the discounted or original price?
At restaurants, tip on the original (pre-discount) total. The server did the same amount of work regardless of a coupon or discount.
Are stacked discounts ever as good as they seem?
They are always slightly less than the sum of the individual percentages, but they can still be excellent deals.
How does a BOGO deal compare to a percentage off?
BOGO free = 50% off when buying two. BOGO 50% off = 25% off when buying two. Run the numbers to see which deal saves more.
Does the discount calculator account for sales tax?
Yes. Enter the optional tax rate and it will show the final cost including tax.
The Precision Calculator Editorial Team
The editorial team at Get Precision Calculator writes practical, formula-driven guides that explain the maths behind every calculator on this site. All content is reviewed for accuracy before publishing.
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