Percentages

New Zealand

Level 5

Lesson

A common usage of percentages in some countries is in the application of taxes, such as sales tax or GST to salable items or in leaving tips at restaurants and cafes.

This great infographic from mint.com displays the tipping customs of many countries around the world. You can see that tips vary from $0$0 to $20%$20%.

Tipping is an amount left for the staff, on top of the bill, as a gratuitous measure of good service. Tips are common in the service industry, but in other sectors like government receiving a tip can be considered illegal.

David is paying for a meal with lots of friends. They received great service, so he is giving a $20%$20% tip. The meal came to $\$182.30$$182.30. How much will he leave as a tip?

**Think**: I need to work out $20%$20% of the total meal charge. $20%$20% as a fraction is $\frac{20}{100}$20100.

**Do**: $20%$20% of $\$182.30$$182.30

$20%$20% of $\$182.30$$182.30 | $=$= | $\frac{20}{100}\times\$182.30$20100×$182.30 | $20%$20% is $\frac{20}{100}$20100 and of in mathematics means multiplication. |

$=$= | $\frac{20\times182.30}{100}$20×182.30100 | ||

$=$= | $\$36.46$$36.46 |

So David should leave $\$36.46$$36.46 as a tip.

In some countries, and states in the US, Sales Tax is added on to sales of goods at the point of sale, on top of the marked price ticket. In countries, sales taxes like the GST (goods and services tax) is included in the marked price ticket. We will look briefly at an example where the sales tax is added on to the ticketed price. In the United States, only five states do not have general sales taxes: Alaska, Delaware, Montana, New Hampshire, and Oregon.

Sale taxes in the US (including local taxes) can range between 4% in Guam and 12% in Arkansas. Sometimes particular services like Hotels, Alcohol or Cigarettes attract extra or higher taxes.

The sales tax on nonprescription drugs in South Dakota is 4%. Calculate how much tax you need to pay if some nonprescription drugs cost $26.80 before tax. Round your answer to the nearest cent.

**Think**: I need to work out $4%$4% of the total sales charge. $4%$4% as a fraction is $\frac{4}{100}$4100.

**Do**: $4%$4% of $\$26.80$$26.80

$4%$4% of $\$26.80$$26.80 | $=$= | $\frac{4}{100}\times\$26.80$4100×$26.80 | $4%$4% is $\frac{4}{100}$4100 and of in mathematics means multiplication. |

$=$= | $\frac{4\times26.80}{100}$4×26.80100 | ||

$=$= | $\$1.07$$1.07 | ||

So the total you need to pay is | $=$= | amount before tax + tax | |

$=$= | $\$26.80+\$1.07$$26.80+$1.07 | ||

$=$= | $\$27.87$$27.87 |

So total you will need to pay is $\$27.87$$27.87 for your nonprescription medication.

Sharon has finished her meal at a restaurant, but received bad service. She will only be leaving a $10%$10% tip. Help her calculate the tip if her meal, before sales tax, came to $\$36.60$$36.60.

Understand operations on fractions, decimals, percentages, and integers