The CID's are usually in low-income areas, and the rates are dictated by property developers who use the tax revenue to subsidize their new developments. Louis, which is home to 138 'special taxing districts,' like 'Community Improvement Districts.' The only Starbucks locations potentially 'overcharging' customers for sales tax were all in St. It took an entire day to find a PDF - hidden in the deepest depths of the internet - explaining that restaurants in downtown Minneapolis are subject to an additional 3% tax in addition to the ones already levied by the city, county, and state. The tax was so secret that the sales tax calculator, found on Minnesota's Department of Revenue's website, couldn't even explain where the additional tax came from. The search for the additional 3% of sales tax levied by a Starbucks in Minneapolis was just as time-consuming. Although websites like that of the Massachusetts Department of Revenue and others claimed Boston's sales tax was 6.25%, I was able to find the missing 0.75% charged by Starbucks buried on the Commonwealth's Data Analytics and Resources Bureau's website. Some Starbucks locations were easier to clear of possible tax fraud than others. So, the following Sunday, I made another spreadsheet. And while businesses overcharging for sales tax isn't that rare - Doordash, for instance, was sued in 2019 as part of a class-action lawsuit for allegedly overcharging sales tax -there was no way I had managed to discover the largest sales tax fraud in American history. I decided to convert the sales tax charged on the Starbucks app into a percentage, and check my math using Avalara, a tax compliance website with data for every U.S city.Īdmittedly, I was never great at math, but I found it hard to believe that I miscalculated the sales tax charged by Starbucks in half of the cities. Instead, my $7 coffee might have been the fault of our state legislators (and by extension, the people that elected them).Ĭombined State, County, Local Tax Rate on Starbucks Coffee (Michael Karlis ) I soon realized that the extreme price variations were neither a product of inflation, supply shortages or America's largest coffee chain. It turned out that Johnson wasn't lying, as Grande Iced Caramel Macchiatos were $4.95 in all but six of the metro areas. The first being the actual cost of the drink, and the other being taxes. I didn't notice that there were two different prices listed on the receipt until the following Sunday. Price of Starbucks Grande Iced Carmel Macchiatos (Michael Karlis ) Louis be comparable to downtown Manhattan? Why was coffee more expensive in Texas than California, and how could prices in St. Yet, the hours spent compiling all of this data only left me with more questions. I decided to record data from stand-alone Starbucks - meaning those not found in hotels or malls - in the downtown areas of the nation's 30 largest metro areas. Louis? I fired up Microsoft Excel and embarked on a month-long truth-seeking journey to solve the mystery of the $7 macchiato. How could an Iced Caramel Macchiato be cheaper in San Diego than in Detroit? Or cheaper in Los Angeles than St. The prices, like everything else these days, made no sense. Needing an explanation, I spent the rest of that afternoon using the mobile order feature on the Starbucks app to look up prices of Grande Iced Caramel Macchiato across the country. I knew the city was becoming more expensive by the day - but $6.55 was absurd, even in Washington, D.C. Want more great food writing and recipes? Subscribe to Salon Food's newsletter. I had heard about the ongoing global coffee shortage - caused by rolling COVID lockdowns and climate change - but I also recall reading that Starbucks CEO, Kevin Johnson, assured customers and investors that Starbucks had stockpiled enough coffee to mitigate any future supply shortages.īut, after paying a price comparable to the minimum hourly wage in some states, I began to question the integrity of Johnson's assurance. Still, it didn't explain why I paid nearly $7 for a grande Iced Caramel Macchiato at a Starbucks in Washington, D.C.'s Dupont Circle on the first Sunday in August. Inflation hit a 13 year high of 5.4% in July, and supply chain disruptions led Vice President Kamala Harris to encourage parents to start buying Christmas presents as soon as possible.īoth inflation and shipping delays are valid explanations for the rising cost of everything. It doesn't matter if you're buying a home, car, food or coffee - the price of everything has soared since the onset of the pandemic.

Starbucks macchiato price