How do I calculate the original price from a sale price?

Divide rather than adding the percentage back. If an item is seventy five dollars after twenty five per cent off, the original was seventy five divided by 0.75, which is one hundred dollars. Adding twenty five per cent to seventy five gives ninety three seventy five, which is wrong, because the percentage was taken from the larger number in the first place.

Why is 40% off plus 20% off not 60% off?

Because the second discount applies to the already reduced price. Forty per cent off leaves 0.6 of the price, and twenty per cent off that leaves 0.8 of 0.6, which is 0.48. You pay forty eight per cent of the original, so the true reduction is fifty two per cent. Retailers know shoppers add the percentages, which is why stacked offers are advertised that way.

Does the order the discounts are applied in matter?

No. Multiplication is commutative, so applying forty per cent then twenty per cent gives exactly the same price as twenty then forty. What does matter is whether the second discount applies to the reduced price or to the original, which is a question for the terms and conditions rather than the arithmetic.

Is a percentage discount always better than a dollar amount?

Only above a crossover price. Twenty dollars off equals twenty five per cent off at exactly eighty dollars, so below that the flat amount wins and above it the percentage does. Work out the crossover by dividing the dollar discount by the percentage expressed as a decimal, then compare that figure against the item's price.

Should tax be calculated before or after the discount?

After, in almost every jurisdiction: sales tax and GST apply to the price actually paid, not the ticket price. That is how this calculator treats it. A small number of goods in some United States jurisdictions are taxed on the pre-discount price when the discount comes from a manufacturer rather than the retailer, which is worth checking on large purchases.

How can I tell if an advertised discount is real?

Compare the sale price against what other retailers charge for the same item rather than against the claimed original. The reference price is the only number in the advertisement the seller sets freely, and consumer regulators in several countries have acted against retailers who raised a ticket price shortly before a sale to advertise a deeper reduction.

Discount Calculator

Works anywhere

Works out the sale price and the saving from an original price and a discount, then handles the case retailers rely on: a second coupon stacked on top, where the true reduction is smaller than the two percentages added together. A $100 item at 25% off is $75.00.

Results

Worked example. Edit the values and press Calculate

Sale price

$75.00

You save
$25.00
Effective discount
25.00%
Price after the advertised discount
$75.00
Price including tax
$75.00
No tax entered, so this matches the sale price.
Original price
$100.00
You pay this share of the ticket price
75.00%

Why use this calculator

Retail discounting is designed around the fact that shoppers add percentages in their heads. Forty per cent off plus an extra twenty per cent at checkout reads as sixty, and it is not, because the coupon applies to the already reduced price. The true figure is fifty two per cent, and the gap between the perceived and actual discount is exactly where the promotion earns its margin.

The same arithmetic hides in a different direction with tax: a sale price quoted before tax is not what the register charges. This calculator shows the real reduction, the real amount paid, and what proportion of the ticket price you are actually handing over, so a stacked offer can be compared honestly against a single larger one.

How to use it

Enter the original ticketed price exactly as displayed, not a remembered price or a price from another store, because the reference price is what every percentage is calculated against.
Put the headline sale reduction into the advertised discount field, taking it from the sign or the listing.
If the retailer is offering a further reduction at checkout, whether that is a coupon code, a member discount or a stacked promotion, enter it in the third field and the calculator applies it to the already reduced price, which is how retailers apply it too.
Finally, if sales tax is added at the register rather than included in the ticket price, enter the rate so the final figure matches what you will actually pay.
Read the effective discount line to see the true reduction.

What each result means

Sale price: What the item costs after every discount has been applied, before any tax added at the register.
You save: The difference between the ticket price and the sale price, in currency rather than as a percentage.
Effective discount: The true combined reduction as a percentage of the original. Compare offers on this number, never on the advertised rates added together.
Price after the advertised discount: The intermediate price the stacked coupon is applied to, which is why the second discount is worth less than it looks.
Price including tax: The amount the register will charge once sales tax or GST is added to the discounted price.
Original price: The reference price every percentage is calculated against. If it was inflated before the sale, the discount is smaller than advertised.
You pay this share of the ticket price: The sale price as a percentage of the original, which is the quickest way to compare two competing offers.

The formula

The price after the first discount

P1 = P × (1 − d1 ÷ 100)

Where P is the original price and d1 the advertised discount rate.

A stacked coupon gives the sale price

S = P1 × (1 − d2 ÷ 100)

Where d2 is the second rate, so the discounts multiply rather than add.

The saving is P − S, and the effective discount is (P − S) ÷ P × 100, which is always smaller than d1 + d2 whenever both are above zero. The checkout figure adds tax: S × (1 + t ÷ 100), where t is the tax rate.

How this number is used in practice

The reference price is the part of a discount that regulators actually police. A was and now claim only means something if the was price was genuinely charged for a meaningful period beforehand, and consumer regulators in Australia, the United States and the United Kingdom have all taken action against retailers who inflated a ticket price shortly before a sale in order to advertise a larger reduction.

The practical defence for a shopper is to compare the sale price against what the item sells for elsewhere rather than against the claimed original, because the original is the only number in the advertisement that the retailer chooses freely.

Stacked discounts are the most reliable way a promotion looks larger than it is. Two twenty five per cent reductions leave you paying 0.75 of 0.75, which is 56.25 per cent of the ticket price, so the real discount is 43.75 per cent rather than fifty.

The gap widens as the percentages grow: fifty plus fifty is not free, it is seventy five per cent off. Once you internalise that stacked discounts multiply, a great many end of season offers become easier to rank against each other.

Discount percentages also hide unit economics. A flat twenty dollars off is a better deal than twenty five per cent off on anything under eighty dollars and a worse one above it, which is why retailers switch between the two formats by price band. On groceries and consumables, a percentage discount on a multi-buy is often worse than a smaller discount on the single unit once you account for what you will not use before it expires, so compare the price per unit of what you will actually consume rather than the headline reduction.

Worked examples

$100 item at 25% off
Sale price $75.00, saving $25.00, and you pay 75.00% of the ticket price.
$249.99 jacket at 40% off with an extra 20% coupon at checkout
Sale price $120.00, saving $129.99, and an effective discount of 52.00% rather than the 60% it appears to be.
$1,200 appliance at 15% off with 10% sales tax added at the register
Sale price $1,020.00, saving $180.00, and $1,122.00 charged at the register once tax is added.

When people use it

Comparing a stacked coupon offer against a single larger discount elsewhere
Checking what a sale item will actually cost once tax is added at the register
Deciding whether a percentage discount or a flat dollar reduction is the better deal
Working backwards from a sale price to check whether an advertised reduction is genuine
Setting a markdown as a retailer and seeing the margin implication before committing

Tips

Stacked discounts multiply. Forty per cent plus twenty per cent is fifty two per cent off, not sixty, and the gap widens as the rates rise.
Compare offers on the effective discount and the final price, never on the advertised percentages, which are chosen to be added incorrectly.
Check the reference price against another retailer. The original price is the only figure in a sale advertisement the seller controls entirely.
A flat dollar discount beats a percentage below a crossover point. Twenty dollars off beats twenty five per cent off on anything under eighty dollars.
Discount order does not change the outcome. Applying twenty then forty gives the same price as forty then twenty, so retailer sequencing is not the issue.
On consumables, compare the price per unit you will actually use. A discounted multi-buy that expires is not a saving.
Check whether tax is included in the ticket price. Australian and UK prices include GST or VAT; most US prices do not.

What it assumes, and where it stops being accurate

The original price is genuine. If the reference price was inflated before the sale, the real reduction is smaller than anything this calculates.
The extra coupon applies to the already discounted price, which is the standard retail treatment but not universal.
Tax is applied to the discounted price, which is correct in most jurisdictions. A few apply tax to the pre-discount price on certain goods.
Shipping, delivery, handling and card surcharges are excluded and can easily exceed the saving on a low value item.
It does not model minimum spend thresholds, tiered discounts, or buy one get one offers, which have different arithmetic.
Currency is shown with a dollar sign; the arithmetic is identical in any currency.

Terms used on this page

Reference price: The was or original price a discount is advertised against. Its accuracy is what consumer regulators scrutinise.
Stacked discount: A second reduction applied to an already discounted price, so the two rates multiply rather than add.
Effective discount: The total reduction as a percentage of the original price, after all discounts have been applied.
Markdown: A permanent reduction in a retailer's selling price, as distinct from a temporary promotional discount.

Questions people ask

How do I calculate the original price from a sale price?: Divide rather than adding the percentage back. If an item is seventy five dollars after twenty five per cent off, the original was seventy five divided by 0.75, which is one hundred dollars. Adding twenty five per cent to seventy five gives ninety three seventy five, which is wrong, because the percentage was taken from the larger number in the first place.
Why is 40% off plus 20% off not 60% off?: Because the second discount applies to the already reduced price. Forty per cent off leaves 0.6 of the price, and twenty per cent off that leaves 0.8 of 0.6, which is 0.48. You pay forty eight per cent of the original, so the true reduction is fifty two per cent. Retailers know shoppers add the percentages, which is why stacked offers are advertised that way.
Does the order the discounts are applied in matter?: No. Multiplication is commutative, so applying forty per cent then twenty per cent gives exactly the same price as twenty then forty. What does matter is whether the second discount applies to the reduced price or to the original, which is a question for the terms and conditions rather than the arithmetic.
Is a percentage discount always better than a dollar amount?: Only above a crossover price. Twenty dollars off equals twenty five per cent off at exactly eighty dollars, so below that the flat amount wins and above it the percentage does. Work out the crossover by dividing the dollar discount by the percentage expressed as a decimal, then compare that figure against the item's price.
Should tax be calculated before or after the discount?: After, in almost every jurisdiction: sales tax and GST apply to the price actually paid, not the ticket price. That is how this calculator treats it. A small number of goods in some United States jurisdictions are taxed on the pre-discount price when the discount comes from a manufacturer rather than the retailer, which is worth checking on large purchases.
How can I tell if an advertised discount is real?: Compare the sale price against what other retailers charge for the same item rather than against the claimed original. The reference price is the only number in the advertisement the seller sets freely, and consumer regulators in several countries have acted against retailers who raised a ticket price shortly before a sale to advertise a deeper reduction.

Use this with

Discount Calculator answers one part of the question. These pick up where it stops: Percentage Calculator, GST Calculator, Markup Calculator, Unit Price Comparison Calculator and Profit Margin Calculator.

Where these figures come from

Works anywhereLast reviewed 2026-09·How we build and check calculators

This calculation is jurisdiction-neutral arithmetic. No country-specific rules are applied.

Australian Competition and Consumer Commission. Rules on was/now pricing and misleading discount claims
US Federal Trade Commission business guidance. Advertising rules covering reference prices and savings claims
UK Competition and Markets Authority. Pricing practices guidance for retailers

Discount Calculator produces an estimate for general information. It is not financial, tax, medical, legal or engineering advice. read the full disclaimer. Spotted a wrong number? Report it and it gets fixed. The form picks up this calculator and the inputs you used.