Advertise one price, charge another

April 4, 2014

You go into the supermarket, pick up a piece of cheese marked $1.99, and take it to the register.  The cashier scans the item, and a total of $2.05 appears, though you know the cheese is not subject to sales tax.  Your indication of surprise does not evoke a response from the cashier, so you pay the requested amount, take your cheese and your receipt, and leave.  At home, you look at your receipt, see the cheese correctly listed at $1.99, and then you see an item labeled “property tax recovery fee,” in the amount of six cents.  You call the store’s consumer inquiry line, where a representative explains that the “property tax recovery fee” is a government mandated tax.  You don’t buy this, so you send a letter to the store chain’s headquarters, where you receive a response referring you to a notice that, in microscopic type, is posted at the store entrance.  Among other things, the notice states that the store reserves the right to add to the price of your item “applicable taxes and governmental fees, whether assessed directly upon you or upon the store.” I suspect you would feel taken advantage of, as I did when I received similar treatment upon receiving my first bill from Consumer Cellular.

In addition to the taxes that they are required by law to bill to their customers, which are not the subject of this post, cell phone carriers are allowed — but not required — to charge fees to recover certain of their costs, including taxes and fees they have to pay various government entities

In the course of examining the Consumer Cellular web site, which I did pretty thoroughly before signing up, I did not notice any indication that fees would be added to the quoted plan prices (I do concede that a link to the customer service agreement, a lengthy document in which the right to collect such fees is buried in a long paragraph, appears on Consumer Cellular’s web site).  My first Consumer Cellular bill contained, in addition to a line listing the usual taxes, a line entitled “Surcharge & Other Charges.”  I contacted customer service and, after an initial exchange of e-mails, received a call from a representative who insisted those charges were government mandated taxes.  After I did some research that indicated the contrary, I wrote to the CEO of the company about both the misinformation given by the rep and the inadequate advance disclosure of those fees, and received back an unsigned letter  itemizing what costs the fees were intended to cover and enclosing a copy of the customer service agreement.

In a world in which the imposition of such fees is allowed, I was very disappointed in the way Consumer Cellular chose to implement them.  My former carrier, Verizon, clearly indicated in its pricing information that the amounts quoted were exclusive of taxes and fees, and its invoices clearly explained that the items listed as fees were not required to be imposed by the government.  Even though I found the imposition of  the fees distasteful, at least Verizon did it openly and conspicuously and with reasonable notice to prospective customers.  My present carrier disappointed me by disclosing its practice to impose such fees far less conspicuously. And I disappointed myself by not getting a firm answer to the question of what total I would be paying  — inclusive of everything — before signing up with a new carrier.  

In this caveat emptor, bottom line, MBA driven world, companies are shifting responsibility for covering business expenses to their customers and employees.  The number of occupations in which the expectation of a tip is communicated to customers is constantly expanding, as are the number of bills for various services that include “fees” that are meant to look like mandated taxes but are not.  And employees are being asked to contribute more to the cost of their benefits, even when their wages are being reduced or held steady.  Government protection against these abuses of power has been inadequate, so it is up to each of us to resist when we can, and complain when we can’t.