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Average Tax Rate Formula

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The Average Tax Rate is the ratio of total taxes paid to total taxable income, expressed as a percentage. Check FAQs

ATR = \frac{TP}{NI}

ATR - Average Tax Rate?TP - Tax Paid?NI - Net Income?

Average Tax Rate Example

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With units

Only example

Here is how the Average Tax Rate equation looks like with Values.

Here is how the Average Tax Rate equation looks like with Units.

Here is how the Average Tax Rate equation looks like.

0.125 = \frac{250000}{2E+6}

0.125 = \frac{250000}{2E+6}

0.125 = \frac{250000}{2E+6}

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Average Tax Rate Solution

Follow our step by step solution on how to calculate Average Tax Rate?

FIRST Step Consider the formula

ATR = \frac{TP}{NI}

Next Step Substitute values of Variables

∴

ATR = \frac{250000}{2E+6}

Next Step Prepare to Evaluate

∴

ATR = \frac{250000}{2E+6}

LAST Step Evaluate

∴

ATR = 0.125

Average Tax Rate Formula Elements

Variables

Average Tax Rate

The Average Tax Rate is the ratio of total taxes paid to total taxable income, expressed as a percentage.

Symbol: ATR

Measurement: NAUnit: Unitless

Note: Value should be greater than 0.

Formulas to find Average Tax Rate

Tax Paid

Tax Paid refers to the total amount of money remitted to the government by individuals or entities in fulfillment of their tax obligations.

Symbol: TP

Measurement: NAUnit: Unitless

Note: Value should be greater than 0.

Formulas to find Tax Paid

Net Income

Net income is a company's total earnings.

Symbol: NI

Measurement: NAUnit: Unitless

Note: Value should be greater than 0.

Formulas to find Net Income

Other formulas in Public Finance category

Go Tax Incidence for Customers

TI = 100 \cdot (\frac{E S}{E D + E S})

Go Tax Incidence for Producers

TI = 100 \cdot (\frac{E D}{E D + E S})

Go Tax Burden for Customers

TB r = \frac{E S}{E D + E S}

Go Tax Burden for Suppliers

TB r = \frac{E D}{E D + E S}

How to Evaluate Average Tax Rate?

Average Tax Rate evaluator uses Average Tax Rate = Tax Paid/Net Income to evaluate the Average Tax Rate, The Average Tax Rate formula is the ratio of total taxes paid to total taxable income, expressed as a percentage. Average Tax Rate is denoted by ATR symbol.

How to evaluate Average Tax Rate using this online evaluator? To use this online evaluator for Average Tax Rate, enter Tax Paid (TP) & Net Income (NI) and hit the calculate button.

FAQs on Average Tax Rate

What is the formula to find Average Tax Rate?

The formula of Average Tax Rate is expressed as Average Tax Rate = Tax Paid/Net Income. Here is an example- 0.125 = 250000/2000000.

How to calculate Average Tax Rate?

With Tax Paid (TP) & Net Income (NI) we can find Average Tax Rate using the formula - Average Tax Rate = Tax Paid/Net Income.

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Average Tax Rate Formula

Average Tax Rate Example

Average Tax Rate Solution

Average Tax Rate Formula Elements

Other formulas in Public Finance category

How to Evaluate Average Tax Rate?

FAQs on Average Tax Rate

Variable Name