WagJag experience - am I right???

[Insomniac1]

So here's my experience.

Had diner with a WagJag coupon valued $40 which I purchased for half.

Bill came in at $36 including taxes and it was my understanding that since the coupon had a face value of $40 that the remainder $4 I had left would cover my tip. I am aware that there is no cash back and was not expecting any change in return however I was told that the coupon "Does not include tax" and that I would have to "Make a $40 diner purchase" and PAY tax on the face value of the coupon ($40).

My arguments is this. I am well within my coupon limit of $40 with taxes and even tips why should I be FORCED to pay taxes on $40 when I haven't ordered $40 worth of food???

I ended up ordering another small food item which brought my new bill to over $40. I paid $6 extra for something I could have done without.

Again I realize that taxes are not included with the coupon which is why I was careful to order well within the max of $40 taking into consideration taxes/tips.

Any feedback would be appreciated.

[firetree]

So here's my experience.

Had diner with a WagJag coupon valued $40 which I purchased for half.

Bill came in at $36 including taxes and it was my understanding that since the coupon had a face value of $40 that the remainder $4 I had left would cover my tip. I am aware that there is no cash back and was not expecting any change in return however I was told that the coupon "Does not include tax" and that I would have to "Make a $40 diner purchase" and PAY tax on the face value of the coupon ($40).

My arguments is this. I am well within my coupon limit of $40 with taxes and even tips why should I be FORCED to pay taxes on $40 when I haven't ordered $40 worth of food???

I ended up ordering another small food item which brought my new bill to over $40. I paid $6 extra for something I could have done without.

Again I realize that taxes are not included with the coupon which is why I was careful to order well within the max of $40 taking into consideration taxes/tips.

Any feedback would be appreciated.

Well,let me put it this way. Simple answer to your question is 'yes' you've got a pt. But i do think that most of these deals do state that 'Taxes are extra' . I guess the key is most of them don't state clearly that tax is base on 'what'?? The value of the coupon? Or the price of food ppl order? Well,i've been to rest. where i was taxed the full value of the coupon and there are some that i was on taxed on the price of food that i ordered.
I guess you can complain to Wagjag and they might give you a credit. But i've bought enough of these coupon to know that it varies from rest. to rest. and it doesn't bother either way.

[Insomniac1]

Well,let me put it this way. Simple answer to your question is 'yes' you've got a pt. But i do think that most of these deals do state that 'Taxes are extra' . I guess the key is most of them don't state clearly that tax is base on 'what'?? The value of the coupon? Or the price of food ppl order? Well,i've been to rest. where i was taxed the full value of the coupon and there are some that i was on taxed on the price of food that i ordered.
I guess you can complain to Wagjag and they might give you a credit. But i've bought enough of these coupon to know that it varies from rest. to rest. and it doesn't bother either way.

Thanks for the response and I agree I've had scenarios where I was able to use just my coupon and it covered both taxes/tip and didn't have to pay any extra. There does need to be some clarification issue. If this were the policy that the customer would have to pay the taxes on the face value of the coupon regardless if he/she spent the entire amount; then I don't think I would be too interested as the coupon would loose it's appeal for me.

My understanding is that the coupon is just like cash and it's up to ME to spend it how I please; minus the no change back off course.

I realize that for some this may be a minor issue but for one reason or another it hit's home to me. I'm a money conscious buyer/spender and value a good deal but absolutely hate when someone tries to give me the run around for my business I'm bringing in regardless if I've got a coupon or not.

[jerrysiz]

It's common for vouchers not to be allowed to be applied to taxes, and they never cover tip. If the voucher/deal stated that tax was not included, you should have been charged tax on the taxable amount of items you purchased (in your case the $32 or so subtotal). You shouldn't have been charged tax on the $40 voucher price if you did not purchase $40 worth of food, but neither could you have just left the voucher and expected it to cover tax and tip (especially tip). You'd have a case if the voucher didn't say anything about taxes, but I find that is usually in the fine print and if that is the case then they were right to charge you tax on what you purchased.

[firetree]

Thanks for the response and I agree I've had scenarios where I was able to use just my coupon and it covered both taxes/tip and didn't have to pay any extra. There does need to be some clarification issue. If this were the policy that the customer would have to pay the taxes on the face value of the coupon regardless if he/she spent the entire amount; then I don't think I would be too interested as the coupon would loose it's appeal for me.

My understanding is that the coupon is just like cash and it's up to ME to spend it how I please; minus the no change back off course.

I realize that for some this may be a minor issue but for one reason or another it hit's home to me. I'm a money conscious buyer/spender and value a good deal but absolutely hate when someone tries to give me the run around for my business I'm bringing in regardless if I've got a coupon or not.

Sorry,i didn't mention about the tip. Almost all of these coupons don't cover the tips. Tips are almost always extra. Some of them cover tax and some don't and usually it's stated under fine print. But what might be different is the amount of tax that a rest. is charging. Whether is your paid amount or the full voucher amount(which is $40 in your case)
I guess most of them do charge the paid amount.(at least that's from my experience!)

[redgrandam]

This was covered somewhere regarding a groupon, I would assume the same with WagJag. The result IIRC was that you should be paying tax on the amount you actually paid. If you pay 10 dollars for a 100 dollar voucher, tax is on what you paid. Some places are probably trying to recoup some extra money.

I'd contact WagJag to be certain. There should be some tax laws at play here.


Then again. Now that I think about it there might have been a time we used a $40 voucher for a restaurant, and they treated it like us handing them $40 cash on the bill. Which would mean we paid tax on the full bill.

So maybe the discussion I was thinking about was getting a voucher for a product. Say you pay $20 for a $40 sheet set. You shouldn't be paying tax on the full $40 price, but just on what you actually paid.

[flafson]

Let me clear it a little bit for you guys as to what it SHOULD be.
I'm a business owner who offered a few deals before so i know how it works with Groupon, Living Social and Deal Find, and of course the law.
Tax SHOULD always be extra and it SHOULD always be on the amount you paid for the coupon. So if you paid $20 for $40 dinner, then you should be charged tax on $20. Tip is also extra because the deal has nothing to do with the person who served your food.
If you give it to them as cash, then most likely it is money in their pocket. If you give it to them using credit/debit then to them it's a commission to which the business owner will have to add to their salary meaning they will be taxed on that amount. So they probably end up "losing" 15-20% on your tip.

Assuming the restaurant is legit and does everything by the book it doesn't matter to them if they charge you tax on $20 or $40 simply because they give it away. To the clients, the end users it means ALOT because this is money that you just wasted. No one is giving it back to you.

It is possible that they aren't legit and are "charging" you tax in order to minimize their expenses of giving away food for loss. You need to remember that Wagjag and others usually do 50/50 So if they are giving away $40 for $20 and then giving away half of that, they pretty much gave away $40 for $10 return. If they charge tax on those extra $20 then that could be another $2.6 in their pocket for every $10. In other words, they just increased their income from this deal by 26%.

[theconstants]

1

[Insomniac1]

We'll I'm at a loss. I don't mean to be difficult but I'm just having a hard time grasping the ideology behind this. I can understand/appreciate that my WagJag does not include any tips as this is between me and the waiter/waitress but I can't come to terms that if I have a $40 voucher and spend $20 why do I have to pay any tax at all? After all I'm the one loosing out on $20.

Not only that but the restaurant I was at (which is legit by the way; ThaiOne Scarborough location) insisted that I purchase $40 worth of food and be taxed on the new amount.

As I mentioned before I've used the same WagJag coupon at this restaurant and others and have not had to pay the tax as I've always been well under the value of the coupon.

Now that I think back to my experience, although the food was fantastic as I've eaten out there on several different occasions before, I was told that "this is the way it works" and was told that they are receiving too many vouchers. It seemed to me that the vendor was almost looking for sympathy as my waitress even insisted that she go back and bring all the vouchers she had received that day!

Thanks to all those that contributed. I will be contacting WagJag about this first thing Tuesday morning and will update as to any further clarification I can get on this. Enjoy the rest of the weekend.

[firetree]

We'll I'm at a loss. I don't mean to be difficult but I'm just having a hard time grasping the ideology behind this. I can understand/appreciate that my WagJag does not include any tips as this is between me and the waiter/waitress but I can't come to terms that if I have a $40 voucher and spend $20 why do I have to pay any tax at all? After all I'm the one loosing out on $20.

Not only that but the restaurant I was at (which is legit by the way; ThaiOne Scarborough location) insisted that I purchase $40 worth of food and be taxed on the new amount.

As I mentioned before I've used the same WagJag coupon at this restaurant and others and have not had to pay the tax as I've always been well under the value of the coupon.

Now that I think back to my experience, although the food was fantastic as I've eaten out there on several different occasions before, I was told that "this is the way it works" and was told that they are receiving too many vouchers. It seemed to me that the vendor was almost looking for sympathy as my waitress even insisted that she go back and bring all the vouchers she had received that day!

Thanks to all those that contributed. I will be contacting WagJag about this first thing Tuesday morning and will update as to any further clarification I can get on this. Enjoy the rest of the weekend.

I think Flafson kind of complicated things a little bit here. It's pretty simple:Before u purchase the voucher,look at the fine print. If it says tax is extra,then prepared to pay for tax on whatever you spend. If they tax you more than your purchased amount,file a complaint to wagjag.

[the stig]

ok wait.... so you buy a $20 voucher worth $40 for a local business and they wanted to charge you tax on $40 ? are you not already charged tax on the voucher when you buy it from wagjag to begin with ? is this not treated like a gift card and such ? so why are you expected to pay tax yet again when you use it at the business.... that sounds wrong.

but i do understand that if you do not use up the full amount of the voucher that the remaining amount is forfeited because it has no cash value and tip is extra.... that's just a given.

but asking the patron to buy more in order to tax more on the meal is wrong. they should only be taxed on the $20 amount since that's all that was spent, or this does not sound like the deal it's supposed to be.

[jerrysiz]

I think Flafson kind of complicated things a little bit here. It's pretty simple:Before u purchase the voucher,look at the fine print. If it says tax is extra,then prepared to pay for tax on whatever you spend. If they tax you more than your purchased amount,file a complaint to wagjag.

This. If tax is not included you pay tax on what you order. The exception being if you buy a specific package deal, then you pay tax on the voucher price.

For example, if you buy a voucher for $20 that gets you $40 of any food off the menu, you're taxed on the total price of food you order off the menu (if tax is included you can use the voucher towards the tax, if not then you pay the tax on the subtotal amount of food), but if you buy a voucher for $20 for two pounds of wings and two pints, you pay tax on the $20 voucher price. That's the way it's almost always done in my experience.

The long and short of it, OP, is that it sounds like in your situation the tax was not included, so they should have charged you tax on the subtotal of what you ordered (unless it was some sort of set package, but it doesn't sound like that is the case here). They should not have charged you tax on the entire $40 if you did not spend the entire amount, and they should not have insisted you buy something extra so you could use the voucher.

So, you're looking at the difference between the tax on $32 and the tax on $40. I'd say the larger problem here sounds like it's the attitude of the merchant, making you order more so you can use the voucher and complaining about how many people are using vouchers is just bad business. I don't understand why a merchant would do a group deal and then seemingly go out of their way to give a hard time or look down on voucher users, they're trying to get positive word of mouth and encourage repeat customers, and this is certainly not the way to do it. It's funny how many times you see businesses doing just that though.

And, now that I think of it, in this particular case, what the merchant did seems particularly stupid. By insisting you order another item to bring your subtotal to $40, they've effectively given you that entire extra dish for about 75 cents in taxes. So not only was it the wrong thing to do in terms of following the voucher policy and good customer service, but it actually cost them money. If that makes you feel any better OP. ;)

[jerrysiz]

are you not already charged tax on the voucher when you buy it from wagjag to begin with ?

No, the voucher companies don't charge taxes on the vouchers when you buy them. So unless the deal says taxes are included, you always pay tax when you redeem the voucher with the merchant.

[TrevorK]

We'll I'm at a loss. I don't mean to be difficult but I'm just having a hard time grasping the ideology behind this. I can understand/appreciate that my WagJag does not include any tips as this is between me and the waiter/waitress but I can't come to terms that if I have a $40 voucher and spend $20 why do I have to pay any tax at all? After all I'm the one loosing out on $20.

An easy way to look at it is: Who should be paying the taxes for your purchase: you, WagJag or the restaurant? Because someone has to.

While there can be dispute over whether to pay taxes on what you paid versus what the value you receive is there should be no dispute over the fact you need to pay some tax.

[Insomniac1]

@ jerrysiz - thanked

It's starting to make more sense now about the whole tax issue. So If I'm correct and as you suggested, if the WagJag fine print stipulates taxes extra, then you should only pay tax on what you order and not the face value of the WagJag coupon. This is what my gut told me when I was ready for the bill but as I mentioned, I was instructed to order the face value of the coupon and to pay the taxes on the $40 as oppose to the amount I actually ordered which was far less.

It's a funny thing because I ate at the same restaurant before, with the same WagJag coupon and was able to apply my taxes within the coupon and did not have to spend a penny more.

I will clarify this with WagJag. Unfortunate thing is that I have another voucher (same terms) and have been really turned off by this whole ordeal. Don't get me wrong the food was great, service mediocre but I knew something didn't seem right when she insisted that I order more and especially when she told me that they were being burdened by the volume of coupons.

[the stig]

i'm still a little confused at this.... the voucher was for $20.... that $20 voucher in turn got you $40 of whatever off the menu. so should you not be paying the taxes on $20 and not $40 ?

the whole purpose of the voucher was that you were getting double the value for half the cost. and you paid $20, so regardless if you used the full $40 amount the voucher was for you should only be taxed on $20.

like i said before, i can understand having to pay the taxes on $20 plus having to give a tip... since you only spent $20 to buy the voucher. you never actually spent $40 since the voucher was for double the amount, so realistically you should only be taxed on $20.

am i not correct ?

once again it sounds like a business screwing around to make confusion of things thus making the patron pay more than they had to. it's tactics like this that make me see how much of a hassle it is and a crap shoot to actually get a deal... you either end up paying more or it's a huge hassle to deal with if a business tries to back out of what they are supposed to honor.

[redgrandam]

I assume the voucher didn't say you had to spend any minimum amount at the restaurant ($40). I have seen some that say that. Sounds like another place that changes the term on a whim for their promotions.

[Insomniac1]

Hey all,

Made contact with WagJag and spoke to customer service explaining what happened with my experience.

Service rep was in agreement and informed that I should have paid taxes on what I consumed/ordered and not on the face value of the coupon. He also went on to state that the merchant was wrong in baiting me to spend more in order to use the voucher as there was no minimum purchase clause in the fine print.

He also stated that it would have been different if I were going for a service like a pedicure (hypothetically speaking as a guy) whereas I would be paying taxes for the full service and couldn't pay for just one hand.

At the end of the call I was returned a credit of $10 which I graciously accepted and suppose could have insisted for a full refund but don't think I would be honest as I did enjoy the food and over paid by only a few dollars.

Got to admit their customer service agent was very friendly and understanding and the entire process took less than 5 mins to resolve.

I guess it's still up for debate I suppose on who whether it should be WagJag, the merchant or customer that be required to pay taxes and if it should be on the full or purchased amount.

I would like to think that you would pay taxes on what you paid for for the coupon but that's not the case and you have to pay taxes on the full value. Which when you work it out doesn't give you 50% off but rather 37% after taxes.

[redgrandam]

Good to hear you got it resolved.

I think part of the issue is that tax rates can vary. Especially if you might be able to use a voucher (not that one) for a small meal under $4 which has less tax, or stuff that has liquor tax on top too.

[flafson]

So much confusion, amazing.

The way that it suppose to be (even when the WagJag rep told you otherwise) is this: You bought a voucher for $20. You pay tax on $20. If the voucher covers $40 worth of food, $10 worth of food or even $1000 worth of food you don't care!
You pay tax on the voucher ALONE!
If you are to exceed the face value then the voucher doesn't apply anymore which means anything above those $40 (before tax) you pay that amount separably plus tax.

It is not the customer problem how much food is given. It's like an all you can eat Sushi place will ask for tax on $200 worth of Sushi because they think you ate that much. You pay tax on the $30 or so. That was the deal when you picked an item from the menu, anything else is not your problem. Your menu was the $20 voucher, you don't care about anything else.

I doubt WagJag would have given full refund because it goes out of their pocket (if they paid the merchant already)