Method and checked examples

How to Calculate Tax Percentages

If a single known rate r applies to the whole taxable amount B, tax = B × r / 100 and total = B × (1 + r / 100).

The short answer

If a single known rate r applies to the whole taxable amount B, tax = B × r / 100 and total = B × (1 + r / 100). For a hypothetical base of 100 at 8%, tax is 8 and total is 108. The rate is supplied by you.

Method and checked examples

To recover the base from an inclusive total, divide by 1 + r / 100. A total of 108 with that same 8% rate gives a base of 100. To express a known tax amount as a rate, divide it by the taxable base and multiply by 100.

B × r / 100
B × (1 + r/100)
108 / (1 + 8/100) = 100
8 / 100 × 100 = 8%
Method and checked examples
InputsCalculationResult
B=100; r=8%100 × 8 / 1008
B=100; r=8%100 × 1.08108
108; r=8%108 / 1.08100

Limits and assumptions

This is arithmetic, not tax determination. Exempt items, multiple rates, compounded levies, shipping and line rounding can require different treatment. Use the relevant invoice or tax authority to establish the rate and base; zero cannot be a ratio denominator.

Sources and scope

This is arithmetic, not tax determination. Exempt items, multiple rates, compounded levies, shipping and line rounding can require different treatment. Use the relevant invoice or tax authority to establish the rate and base; zero cannot be a ratio denominator.

These are hypothetical calculations in generic monetary units. Source links support the methods, not current prices, offers or tax rates.

  1. OpenStax

    Percent equations and the original base.

Publisher: Kymata Labs LLC. Contact and corrections.