Tax Rate

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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.

G. L. MAR’IAKHIN

References in periodicals archive ?
With measures developed here for both marginal and average tax rates, it is possible to control for the Peltzman-Rabushka relation between average tax rates and income per capita and thereby to isolate the effects of "progressivity" of the tax structure (i.
As shown in Figure B, the average tax rate on all taxable returns as a percentage of AGI was 13.
Most of the fluctuations in the average tax rate during the past 90-plus years can be attributed to tax law changes affecting the definition of income reported on a tax return and to how tax before credits was calculated on that income.
This is a considerable addition to their average tax rate.
1) While the PIT system remained unchanged before 2005, as average personal income increased, the increasing average tax rate expanded the income redistribution effect of PIT (measured as the Musgrave and Thin [MT] index, which is the difference between the pre- and post-Gini Index) despite the decrease in tax progressivity (measured as the Kakwani Index).
From 1981 to 1984, the period around ERTA81 (see Table 1), average tax rates decreased for all income groups.
1) with tax-free amount T2 = - K + t2 x Y, where K is the tax-free amount for all entities obtaining income Y > Y0 = K / t2, and t2 is the extreme higher than average tax rate which equals T2 / Y = - K / Y + t2.
10) However, it is clear that the current system, in which married women typically face high average tax rates on even small amounts of income, causes economic harm by discouraging women from working.
They are the cost of capital, the effective marginal tax rate (EMTR) and the effective average tax rate (EATR), according to the Devereux-Griffith methodology.
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.
In contrast, the Bush tax cuts reduced average tax rates for all income levels.
The results of the matched-sample mean comparisons are varied but in general show that the tax calculator produces total taxes and average tax rates with differences that are large and statistically significant at the 5-percent level.