Average tax rate
Filed Under: Taxation
1 definition found for this term.
Definitions are presented in the order source books were published (most recent first).
Source:
The ratio of taxes paid to the tax base. Accordingly, the average income tax rate is the ratio of income tax paid to income. For example, someone who pays $10,000 in income tax on a taxable income of $50,000 would have an average tax rate of 20 percent.