Measuring Effective Tax Rates

Research Report

Measuring Effective Tax Rates

Abstract

Effective tax rates (ETRs) measure how much people pay in taxes as a percentage of their pretax incomes. That seems simple, but theres an important complication: there are different ways to measure how much someone pays in taxes and how much he collects in pretax income. Those choices matter a great deal. As a result, it is essential to use the same ETR measure when comparing tax burdens across individual taxpayers or groups.

To reuse content from Urban Institute, visit copyright.com, search for the publications, choose from a list of licenses, and complete the transaction.