Why is McDonalds Charging Sales Tax on Donations? Anyway, the New San Francisco Happy Meal is Exactly the Same as the Old

Well here it is, the before and after of the San Francisco Happy Meal from McDonalds.

Today’s the day that the San Francisco’s Healthy Meal Incentives Ordinance kicks in. The upshot is that now you have to donate 10 cents to Ronald McDonald House in order to get the toy.

See?

Click to expand

(Note the apple slices in the upper right. They’ve been around for a while.)

But uh oh, is Micky Dee’s charging sales tax on the donation? Yes it is. I cry foul.* (Uh, San Francisco McDonaldses, can you do that? Do you need to rejigger your registers?)

This sign was just put up. It’s all “10 cents adds a toy.”

Now I’ll tell you, I can recall buying a Hamburger Happy Meal in Palo Alto last year for exactly two-fitty ($2.50). It had more fries plus the free toy (but it didn’t have apple slices or a slice of cheese for the burger.) Anyway, prices be going up, it seems.

Oh well.

*So, the only reason to charge sales tax is if the 10-cent purported “donation” is actually for the “retail sale of tangible personal property,” right? So which is it, a donation or a sale? I mean if I donated money to Ronald McDonald House on Scott Street, they sure as Hell wouldn’t tack on sales tax, would they? Mmmm… I paid ten cents extra to get a toy, right? Thinking out loud here, could it be that, as far as San Francisco is concerned, the 10 cents shows that the toy isn’t included “for free” and therefore the sale need not comply with the HMIO, but as far as the state of California is concerned, McD’s is just selling the toy for 10 cents, so therefore, obviously, a penny needs to be collected and forwarded to Sacramento for each sale? (But of course, if you walk up and offer your 10-cent donation for just the toy, they’ll say, “No dice.” They used to charge $2 for toy only purchases). Have the legal advisers for area McDonalds restaurants thought this through? I don’t know. Anyway, the approach they’re taking appears to be a giant F.U. to the City and County of San Francisco. I’ll tell you, the path they’re on is full of rusty nails and garbage pails. Just saying. But hey, what about McDonalds Corporation in Oak Brook, Illinois? Did they sign off on this? I wonder. (Did they indemnify the local owners? By contract, or, you know, some other way. I’m just curious about who came up with this ten cent idea.) Anyway, this is me thinking aloud, just raising issues. I can’t wrap my head around “ten cents adds a toy” and how that relates to state tax law. Like when I got my Android phone plus two-year contract for $50, I had to pay another $50 or so in sales tax because the phone is worth far more than $50. For example…

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One Response to “Why is McDonalds Charging Sales Tax on Donations? Anyway, the New San Francisco Happy Meal is Exactly the Same as the Old”

  1. George says:

    I hope that you are night impugning the honor and integrity of McDonalds in this matter?

    Please be advised that McDonalds retains expert legal counsel, as well as connections with various well-heeled-and-armed ethnic mafias.

    I am sure that you are not suggesting that McDonalds is trying to evade any sort of rule or regulation.

    McDonalds is an eco-friendly corporation which practices eco-mindedness in all its socially conscious decisions.