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"Extra 20% off" is less than you think — the math of stacked discounts

Sep 15, 2026 · ~6 min read · Money

Quick answer: stacked discounts multiply, they don't add. A 30% discount followed by an extra 20% off leaves you paying 0.70 × 0.80 = 0.56 of the original price — a total of 44% off, not 50%. On a ₹10,000 jacket that is ₹4,400 off, not ₹5,000, a ₹600 difference that checkout pages quietly keep.

Why the second discount applies to a smaller number

When a store takes 30% off a ₹10,000 jacket, the price becomes ₹7,000. The "extra 20% off" is then applied to ₹7,000, not the original ₹10,000 — 20% of ₹7,000 is ₹1,400, giving ₹5,600. The marketing copy says "50% off" because both numbers appear on the tag, but the second percentage never sees the original price.

final price = original × (1 − d₁) × (1 − d₂) × … × (1 − dₙ)

Every discount in the stack shrinks the base the next one works on. That's why the combined discount is always less than the sum of the parts.

Worked examples

StackComputeYou payReal discount"Advertised"
30% + 20%0.70 × 0.80 = 0.5656%44%50%
50% + 20%0.50 × 0.80 = 0.4040%60%70%
25% + 15% + 10%0.75 × 0.85 × 0.90 = 0.57457.4%42.6%50%
70% + 30%0.30 × 0.70 = 0.2121%79%100%!

The last row is the classic clearance sign: "70% off, take an extra 30% — everything must go, that's 100% off!" It is 79%. Nobody is paying zero.

Doing it in your head

Convert each discount to its "keep" fraction and multiply: 30% off → keep 0.70; extra 20% → keep 0.80. 0.70 × 0.80 = 0.56, so keep 56% — pay 56% of the tag. One digit of precision is usually enough to catch a bad deal.

When stacking is in your favour

Coupon codes that apply after the sale price, loyalty points computed on the reduced price, and cashback calculated on the amount actually charged all compound the same multiplicative way — in your favour. The order matters for your wallet only in which base each percentage applies to; the multiplication itself is commutative, so the final price is the same whichever code is entered first. What matters is whether a discount is computed on the original tag or the running total.

FAQ

Is 20% off then 10% off the same as 10% then 20%?

Yes — the final price is identical (0.80 × 0.90 = 0.72 either way). Stores may apply them in a fixed order, but the result doesn't change.

How do I compare a 40% flat discount vs 25% + 20%?

Compute both keep-fractions: flat 40% → pay 0.60. Stacked: 0.75 × 0.80 = 0.60 — identical. Many "stacked" offers are engineered to look bigger than a flat cut that produces the same number.

Does tax apply before or after discounts?

Typically on the final discounted amount, but check your jurisdiction — some apply VAT to the pre-discount price. The difference is the tax rate times the discount amount.

Try it on your own numbers

Discount Calculator Full discount guide Percentage Calculator

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