Tax Rate

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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 ?
From 1997 to 2005, the PIT system remained unchanged, while individual income rose quickly; most people then became eligible for a higher marginal tax rate, such that the average tax rate increased steadily and then declined by 1% in 2006.
Figure 1 shows how the total average tax rate developed from 1979 to 2007 (black diamond).
1) Average tax rate is the quotient of the total value of tax revenues and the taxation base.
This is especially true for the decision to work or not work, for which the average tax rate is most relevant.
Again, Table 4 from the annex below, summarizes the estimated values of effective average tax rates (EATRs) on investments in Macedonia calculated with assumed pre-tax real rate of return of 20%.
16) The average tax rate has not varied much from its mean of 14% since 1960 while economic growth has varied dramatically from year to year suggesting little relationship between the two.
It is interesting to note that from 1979 through 2000 the average tax rate for the highest quintile and the top 5 percent of the income earners trended upward, while the average tax rate for the remaining quintiles trended down.
Two variables are analyzed in this section: the difference in total tax and the difference in the average tax rate.
On the counter side to all of this, I have recently seen retirement preservation fund withdrawals being taxed at rates less than the mandatory 27% being the minimum average tax rate applicable according to the law the way I have it.
I attended a small dinner in Omaha in April in which Warren Buffett spoke about how he paid an average tax rate in one particular year of 15.
2 trillion in itemized deductions was instead spread throughout the tax base, the average tax rate could be reduced by roughly a fifth, from 17.