The Three Discount Situations
Almost every discount question falls into one of three types: finding the final price after a percentage off, working out what discount percentage a price drop represents, or reverse-engineering the original price from a sale price and a known discount. The three formulas below cover each case.
The Three Formulas
Final Price = Original Price × (1 − Discount% / 100)
Example: Jacket priced at ₹3,500 on 35% off sale
Final Price = 3,500 × (1 − 35/100)
= 3,500 × 0.65
= ₹2,275
Savings = ₹3,500 − ₹2,275 = ₹1,225Stacked Discounts: Why 20% + 10% ≠ 30% Off
Stacked (sequential) discounts are applied one after another — each one applies to the new lower price, not the original.
Example: ₹5,000 item with a “20% off, then extra 10% off” deal
- Step 1: Apply 20% → ₹5,000 × 0.80 = ₹4,000
- Step 2: Apply 10% → ₹4,000 × 0.90 = ₹3,600
Final price: ₹3,600 — effective discount is 28% off, not 30%.
The order of discounts doesn’t matter (multiplication is commutative), but they never simply add together.
GST on Discounted Items
In India, GST is charged on the transaction value — the price you actually pay after the discount.
Example: A ₹2,000 shirt on 20% off with 12% GST
- Discounted price = 2,000 × 0.80 = ₹1,600
- GST = 1,600 × 12% = ₹192
- Final amount = ₹1,600 + ₹192 = ₹1,792
However, if a discount is linked to a post-sale condition (like early payment), GST rules may differ. For business purchases, always check the invoice value.
Quick Reference Table
| Discount % | Multiplier | You Pay (of Original) |
|---|---|---|
| 5% | × 0.95 | 95% |
| 10% | × 0.90 | 90% |
| 20% | × 0.80 | 80% |
| 25% | × 0.75 | 75% |
| 30% | × 0.70 | 70% |
| 40% | × 0.60 | 60% |
| 50% | × 0.50 | 50% |
Mental shortcut: For a 30% discount, multiply the price by 0.7. For 25% off, multiply by 0.75.
Use our Discount Calculator to instantly find the final price, savings amount, and effective discount percentage for any combination — including stacked discounts.