This means a 20% reduction in the price to the retailer and presumably a corresponding reduction to Joe.
Why would, more accurately, why should the retailer reduce his price when he knows there's a 30% tax waiting to be paid at the other end of any of his gains?
Because, looey, this is an example to illustrate a point. It does not presume that the retailer is - like some - greedy. Implicit in the example is that market forces prevail and the retailer must compete with others offering similar things.
Get a crip!