I might be wrong but I think it's a practice that is common in day care centers. With the ratio changes, the infant spaces in a center are hard to find but the older age groups are rarely at capacity. By offering a sibling discount, they can retain the older children.
For some parents, they mis-understand that this is an industry wide normal practice and fail to understand that in a day home at least, a space is a space.
I am sure for their requested 15% discount, they wouldn't be so keen if the care was also reduced by 15%. i.e. Sure, you can have a sibling discount but that's not cutting into my income so pick which of your children wants 15% less food on their plate, doesn't get to complete the last 15% of any crafts and receives 15% less love and affection.
Here (and I am sure in most day homes) 100% of the service requires 100% of the fees. I'm not offering a sibling discount - why would I when taking a different client means 100% fees.