How to Calculate Base Price

Sometimes you need to calculate the base price of an object from the final price and the sales tax. One such instance is when you're selling something for which you have to charge sales tax and you want the final price to be a whole number of dollars. So if the final price is £3 and the sales tax is 6 per cent, how much was the base price? It's time for a little reverse mathematical engineering.

Find the final price of the object.

Find the effective sales tax percentage.

Divide the full price by 1 plus the sales tax percentage. For example, if the sales tax is 5 per cent, the divisor will be 1.05. The result of your calculation is the base price.

Use an online calculator (see Resources) to double-check your calculations.


It may help to have a formula for problems like this. Below is such an aid: FP = Full Price ST = Sales Tax BP = Base Price BP = FP / (1 + ST) Remember that sales tax percentages are usually stated as whole numbers, sometimes with a decimal, such as 6.7 per cent. What that number actually is, however, is 0.067.

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About the Author

Since 2001, Lewis R. Farley has worked successfully online as a writer and editor. Farley began his writing career as a reporter/photographer in Jackson, Ohio, eventually being promoted to executive editor. He attended Rio Grande Community College and Southwestern Business College in Ohio, and Cochise Community College in Arizona.

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