Home > Terms > English, UK (UE) > Marginal tax rate
Marginal tax rate
The amount of one's additional (marginal) earnings that must be paid explicitly in taxes or implicitly in the form of a reduction in the level of one's income supplement. Since it establishes the fraction of an additional dollar earned that an individual is permitted to keep, it is an important determinant of the incentive to work.
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- Part of Speech: noun
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- Industry/Domain: Politics
- Category: U.S. politics
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