Tax Rate

(redirected from Average tax rates)
Also found in: Dictionary, Thesaurus, Legal, Financial, Wikipedia.
Related to Average tax rates: Marginal tax rates

Tax Rate


the amount of tax levied per unit of taxation, for example, per hectare of land or per ruble of income.

The tax rate expresses the norm of tax collection and is set by legislation. Tax rates may be fixed, proportional, progressive, and regressive. Fixed tax rates are established as an absolute sum per unit or object taxed, regardless of the amount of income, and are ordinarily used in taxing small plots of land. In the USSR, fixed rates are applied in collecting the agricultural tax on the private plots of kolkhoz members. Proportional tax rates are set at a definite percentage of income, regardless of the total amount. In the USSR, for example, proportional rates are used to levy an income tax on the income earned by consumer cooperative societies.

Progressive tax rates increase as the amount of taxable income increases. A distinction is made between simple and complex, or sliding, progressions. Under a simple progression, the rate increases with the amount of taxable income and is applied to the total amount of income or total value of the object being taxed. Under a complex progression, the rate increases only for the portion valued in excess of a predetermined preceding step. Progressive rates are used primarily in the levying of income taxes on the populace of the USSR and foreign countries.

Regressive tax rates diminish as the amount of income increases. Regressive taxation is clearly seen in the mechanism of indirect taxes on consumer goods that exists in every capitalist country. Under capitalism, special tax rates are frequently used to give certain advantages to large companies and corporations.


References in periodicals archive ?
The adverse impact of the income tax is exacerbated because of its progressive structure, with marginal tax rates being greater than average tax rates.
Where tjy measures national average tax rate for tax source j (j=l to n) in year y
One noticeable difference is that the relative gains from the Bush tax cuts are more uniform: The average tax rates declined by 2.
The average tax rates are determined by dividing total tax by total income in the same manner depicted in equation (5).
As a result of these changes, the average tax rate for farm sole proprietors was reduced from 17.
The household model implies that at the state average tax rate, the minimum assessed value required to receive a circuit breaker credit is about $227,000.
One approach is to introduce average tax rates as well as marginal tax rates in the regression analysis.
As discussed above, the high marginal tax rates and sharp increases in average tax rates at modest income levels especially require more attention.
States vary widely in their average tax rates, with Alaska's average tax rate being three times that of Montana in 1997.
Engen and Skinner (1992) find a negative correlation between average tax rates and economic growth in a sample of 107 countries during the 1970-85 time interval.
in Current and Constant Dollars, and Average Tax Rates, by Selected
These changes in law resulted in average tax rates reaching double digits for the first time in 1942 and rising to more than 14.