Tax rate definitions

Question 1

Marginal tax rate

Answer 1

Tax rate applies if tax base increases by R1

Question 2

Statutory tax rate

Answer 2

Tax rate imposed on the tax base by legislation

Question 3

Average tax rate

Answer 3

The rate at which tax is paid with references to the tax base of the taxpayer

Question 4

Effective tax rate

Answer 4

Used as a measure to facilitate comparability between the tax liability of different taxpayers.