How a percent-off discount works
A discount of D% means you pay (100 − D)% of the price. Twenty percent off $80 means paying 80% of $80, which is $64. Multiplying by what you pay is quicker and less error-prone than working out the discount and subtracting it, especially in your head: 25% off is × 0.75, 40% off is × 0.60.
Why 20% off plus 10% off isn't 30% off
When a store offers "an extra 10% off sale prices", the second discount is taken from the already-reduced price, not the original one. On an $80 item, 20% off brings it to $64. The extra 10% is 10% of $64, which is $6.40, not $8. You pay $57.60, a total discount of 28%, not 30%.
In general, stacked discounts multiply: 0.80 × 0.90 = 0.72, so you pay 72% of the original price. The combined discount is always a little less than the sum, and the gap grows as the discounts get bigger: 50% off and then another 50% off is 75% off, not free.
The order doesn't matter. Ten percent off and then 20% off gives the same $57.60, because multiplication works in any order. What does matter is whether a deal is truly stacked or whether one discount replaces the other, so read the terms.
Sales tax and "was" prices
Sales tax is usually charged on the price you actually pay after store discounts, so the discount saves you the tax on the amount taken off too. Rates vary by state, county and city; enter your combined local rate, or leave it at zero for a pre-tax price.
A big percentage off is only a deal if the starting price was real. Federal Trade Commission guidance says a former price used in a "was/now" comparison should be the actual, bona fide price the item was offered at on a regular basis. Comparing the final price with what other stores charge is the best check.
The formulas
Sale price = P × (1 − D1) × (1 − D2)Combined discount = 1 − (1 − D1) × (1 − D2)Final price = Sale price × (1 + R)- P = original price
- D1, D2 = the discounts as decimals (20% = 0.20)
- R = sales tax rate as a decimal
Example
- A jacket is $80, marked 20% off, with an extra 10% off at checkout and 6% sales tax.
- After 20% off: $80 × 0.80 = $64.00.
- After the extra 10%: $64 × 0.90 = $57.60. You save $22.40, which is 28% of $80.
- Sales tax: $57.60 × 0.06 = $3.46 (rounded to the cent).
- Final price: $57.60 + $3.46 = $61.06. A single 30% discount would have been $56.00 before tax.
Frequently asked questions
How do I calculate 20% off?
Multiply the price by 0.80. Twenty percent off $80 is $80 × 0.80 = $64, a saving of $16.
Is 20% off and then 10% off the same as 30% off?
No. Stacked, they come to 28% off, because the 10% is taken from the reduced price. On $80, that's $57.60 instead of $56.00.
How do I find the original price from a sale price?
Divide the sale price by 1 minus the discount. A $64 sale price at 20% off was $64 ÷ 0.80 = $80.
Does the order of two discounts matter?
Not for percentage discounts: 20% then 10% and 10% then 20% both leave you paying 72% of the price. It can matter when one discount is a fixed dollar amount, because a percentage taken after a dollar-off coupon applies to a smaller number.
Is sales tax charged before or after a discount?
Store discounts usually reduce the taxable price, so tax is charged after the discount. Manufacturer coupons are treated differently in some states, where tax is charged on the price before the coupon.
Sources
Last reviewed for 2026. How we calculate.