Select a per-unit or percentage-tax solve, or explore the stated incidence, business-margin and comparison scenarios. Enter your own tax amounts; the calculator does not determine jurisdiction-specific tax owed.
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Per Unit Tax Formula
The following formulas are used to calculate total tax when a tax is charged on a perโunit basis (a specific tax). If you instead have a percentage tax rate (adโvalorem), you can convert it to a perโunit amount using the unit price.
Variables:
- TT is the total tax ($)
- ฯ is the tax per-unit ($/unit)
- Q is the quantity of items (units)
- UP is the unit price ($) (used for percentage/adโvalorem taxes)
- TR is the tax rate (%) (divide by 100 to convert to decimal form)
To calculate the total tax for a perโunit (specific) tax, multiply the tax per-unit (ฯ) by the quantity (Q). If you have a percentage tax rate instead, convert the rate to decimal form (TR/100), multiply by the unit price (UP) to get the perโunit tax, and then multiply by Q.
What is Per Unit Tax?
A per-unit tax (also called a specific tax) is a fixed amount of tax charged on each unit of a product or service (for example, $0.50 per gallon). The total tax is the perโunit tax multiplied by the number of units purchased. This differs from an adโvalorem tax (such as many sales taxes), which is charged as a percentage of the itemโs price.
How to Calculate Per Unit Tax?
The following steps outline how to calculate the total tax on a per-unit basis.
- Determine the tax per-unit (ฯ) in dollars per-unit.
- Determine the quantity (Q) of items.
- Use the perโunit formula: TT = ฯ ร Q.
- If you are starting from a percentage tax rate instead, convert it to decimal form (TR/100) and compute the perโunit tax: ฯ = UP ร (TR/100).
- Finally, calculate the total tax (TT) in dollars.
- After inserting the variables and calculating the result, check your answer with the calculator above.
Example Problem :
Use the following variables as an example problem to test your knowledge.
Unit Price (UP) = $50
Tax Rate (TR) = 8%
Quantity (Q) = 5
Perโunit tax (ฯ) = UP ร (TR/100) = 50 ร 0.08 = $4 per-unit, so total tax (TT) = ฯ ร Q = 4 ร 5 = $20.
