Sliding scale fees are variable prices for products, services, or taxes based on a customer's ability to pay. Such fees are thereby reduced for those who have lower incomes, or alternatively, less money to spare after their personal expenses, regardless of income.[1] Sliding scale fees are a form of price discrimination or differential pricing.
A business or organization may have various motivations for pricing a product or service on a sliding scale. These may include the desire to be charitable to those less able to afford the product or service, their ability to get a tax deduction for offering their services as charity, their ability to benefit from the revenue even from a partial payment, their retention of a longtime customer/client, or referrals that such a customer/client may provide.
For example, healthcare providers sometimes offer a sliding scale of fees to patients.[2] Some child-adoption agencies collect legal fees (normally very expensive) on a sliding scale, so that couples across a wider range of incomes are able to adopt children.[3] Sliding-scale fees are also often charged by lawyers, places of worship, and for tuition at educational institutions.[4]
See also
edit- Pay what you want
- Price discrimination
- Sliding wage scale
- Ability to pay
References
edit- ^ Taylor, C. "The Economics of Sliding Scale Pricing". smallbusiness.chron.com. Small Business - Chron.com. Retrieved 2 July 2021.
- ^ Banton, Caroline (21 August 2019). "Reading Into Sliding Scale Fees". Investopedia. Retrieved 2 July 2021.
- ^ Pueblo.gsa.govArchived 2008-12-08 at the Wayback Machine
- ^ "Tickets without fees". Thursday, 24 August 2017
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