surtax

Dictionary: sur·tax

(sûr'tăks') pronunciation

An additional tax.
A tax levied on corporations or individuals after net income has exceeded a certain level.

tr.v., -taxed, -tax·ing, -tax·es.
To levy a surtax on.

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Investment Dictionary: Surtax

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An additional tax on income paid by an individual or corporation.

Investopedia Says:

For example, during the Vietnam War U.S. Congress levied a surtax on income to finance the war effort. This added to the animosity towards the war.

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Business Dictionary: Surtax

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Additional tax, based on the amount of the basic tax. Since 1993, a 10% surtax will be added to the 36% Marginal Tax Rate for taxable incomes above a certain amount, $283,150 in 1999 for individuals, making the highest tax rate 39.6% (36% + 3.6% = 39.6%).

Law Encyclopedia: Surtax

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This entry contains information applicable to United States law only.

An additional charge on an item that is already taxed.

A surtax is a tax on a tax. For example, if a person pays one hundred dollars of tax on one thousand dollars of income, a 5 percent surtax would amount to an additional five dollars.

Economics Dictionary: surtax

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A tax added to an existing tax. To help finance the Vietnam War, for example, Congress imposed a surtax on the federal income tax.

Wikipedia: Surtax

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A surtax, may be a tax levied upon a tax, or a tax levied upon income.

United States

Proposed in 2009: New taxes to fund the federal government's plan for higher health insurance spending continue to be debated in Washington. According to a new Bloomberg report, the top surtax rate will be 5.4 percent in the House plan.[i] That will be the top rate in a three-tiered surtax aimed at high-income tax returns:

1 percent surtax on AGI between $350,000 and $500,000 (singles between $280,000 and $400,000)

1.5 percent surtax on AGI between $500,000 and $1,000,000 (singles between $400,000 and $800,000)

5.4 percent surtax on AGI beyond $1,000,000 (singles beyond $800,000)

Previous examples of a broadly-levied surtax in the United States include one imposed to help finance the Vietnam War during the Lyndon B. Johnson administration. It essentially consisted of calculating one's ordinary federal income tax liability and then adding another 10% to it -- the amount of the surtax.

As the U.S. Income Tax Code at that time was an extreme example of progressive taxation, the surtax was much higher on those with higher incomes, as a 10% surtax imposed on a tax rate of 20% would result in an overall rate of 22%, while the same surtax imposed on a rate of 50% would result in an overall rate of 55%.

Some anti-war protesters refused to pay this tax, stating that while they were not anarchists and understood the need for and positive role played by government in many areas, they wanted none of their tax money going to a war that they felt was immoral.^{[citation needed]} The surtax was repealed well before the war ended in Vietnam.

Surtaxes can be imposed on other taxes. They are usually imposed on the grounds of moral justification; they only affect persons who are already paying taxes rather than extending taxation to new areas or persons who are not previously being taxed.

A surtax of 4.3 percent was recently proposed on incomes over $500,000 by Congress to alleviate the alterations to the Alternative Minimum Tax code in the United States.

United Kingdom

In 1929, Supertax (which had been introduced in the Finance Act 1909 at the rate of 6 old pence in the pound (2.5%) on incomes over 5000 per year) was renamed Sur-tax. By 1934, the rate was variable from 1 shilling to 7 shillings and sixpence in the pound (5% to 37.5%).

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		Law Encyclopedia. West's Encyclopedia of American Law. Copyright © 1998 by The Gale Group, Inc. All rights reserved. Read more
		Economics Dictionary. The New Dictionary of Cultural Literacy, Third Edition Edited by E.D. Hirsch, Jr., Joseph F. Kett, and James Trefil. Copyright © 2002 by Houghton Mifflin Company. Published by Houghton Mifflin. All rights reserved. Read more
		Wikipedia. This article is licensed under the Creative Commons Attribution/Share-Alike License. It uses material from the Wikipedia article "Surtax". Read more
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	sur– (prefix)
	Surcharge (business term)
	Accumulated Profits Tax (finance term)

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surtax

United States

United Kingdom

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