Investor Glossary-marginal tax rateInvestor Glossary-marginal tax rateInvestor Glossary-marginal tax rateInvestor Glossary-marginal tax rateInsightful stock market charts - Click here
investor
Categories    # A B C D E F G H I J K L M N O P Q R S T U V W X Y Z

Marginal Tax Rate

The HTML to link to this page
 

The marginal tax rate is rate of tax applicable to each additional dollar of income. In other terms, the marginal tax rate indicates the changes in tax rates as they relate to the changes in taxable income. The marginal tax rate can be expressed mathematically in the following way: marginal tax rate = Δ(tax owed)/Δ(taxable income). Thus, for example, a marginal tax rate of zero is indicative of a flat taxation model. When referring to a marginal tax rate, economists typically consider a combination of federal, state, and local taxes. As such, marginal tax rate applies to all tax brackets. An increased marginal tax rate is often debated. Critics of progressive marginal tax rate argue that it leads to an infinitely augmenting tax rate and discourages investment incentives.



Rate this marginal tax rate definition...

Learn about investing with the Investor Glossary Term of the Day


Click here for insightful stock market charts. Where is the market headed? The answer may surprise you. Find out
with the exclusive & Barron's recommended charts of Chart of the Day.


Popular Terms: inflation, stock split, required rate of return, 144a, option premium, VIX, class C shares, implied volatility, diluted share, average price per share, APR, risk management, deferred revenue, LIBOR, limit order, deferred tax, real GDP, ex-dividend, current ratio, annual return, minority interest, 1031 exchange, stock market close, FICO score, labor relations, per diem, retained earnings, quality assurance, ex-dividend date, FTSE, debt service coverage, liquidity ratio, 401a, command economy, dividends payable, Key Rate Duration, Zero Cost Collar, irrevocable trust, balance sheet, reverse mortgage, open position, 1035 exchange, phantom income, covered put, cancelled check, in escrow, EBITDA, wholly-owned subsidiary, margin rate


Accounting | Banking | Bonds | Brokers | Economy | Futures | Mutual Funds | Options | Real Estate | Retirement | Stocks | Taxes | Technical Analysis
Home | Term of the Day | Suggest a Term | Chart of the Day | Dogs of the Dow
©2004-2016 Investor Glossary - All rights reserved - Terms of Use