13

Our government introduced a new Payee tax scheme. Can someone please explain how does the word 'less' work in this context?

enter image description here

  • More confusing for me is the meaning of /-. The only reference I can find is a historical usage "often used to often used to indicate the absence of an amount e.g. 3/- or -/6" in the context of shillings and pence. – JBentley Apr 2 '18 at 2:03
  • @JBentley it's fairly common in India to mark the end of the number, when writing about money, but usually for hand-written figures. IIRC the received wisdom is that it's to prevent people from easily tacking on digits after the figure. I'd assume the same holds for Sri Lanka and other nearby Commonwealth countries. – muru Apr 2 '18 at 6:42
  • @NathanL OP’s profile indicates Sri Lanka, not India. In any case, I don’t think a country tag is necessary here. – Ben Miller Apr 2 '18 at 20:49
29

"A less B" means "A minus B".

For example, "4% of X less 4,000" means "(4% of X) minus 4000", that is,

0.04 * X - 4000

This table describes progressive tax rate, where each bracket is taxed at its own rate. The higher the bracket, the higher the rate.

  • 7
    Because this is prose rather than an actual equation, without anything more, the intended order of operations would be ambiguous: "4% of X less 4000" could mean either "(4% of X) minus 4000" or "4% of (X minus 4000)". The table has extra space between "employment" and "less" in each row, and I think that's meant to disambiguate (in favor of the first interpretation). – zwol Apr 1 '18 at 19:53
  • 5
    Continuity of the tax(income) function disambiguates the order of operations better than spaces in the text. I decided against adding that to the answer, because this is outside of the scope of the question. – void_ptr Apr 2 '18 at 1:24
14

“Less” means “minus.”

The table you posted describes a marginal tax rate. With a marginal tax system, parts of your income are taxed at different rates.

The first Rs. 100,000 of your monthly income is tax free, the next Rs. 50,000 is taxed at 4%, and the next Rs. 50,000 is taxed at 8%.

The text in the right column of the table is a formula to calculate your total tax. For example, if your monthly income is Rs. 160,000, then the first Rs. 100,000 is tax free, the next Rs. 50,000 is taxed at 4% (Rs. 2,000) and the final Rs. 10,000 is taxed at 8% (Rs. 800). The formula for an income of Rs. 160,000 is 8% of your monthly income minus Rs. 10,000. By applying this formula, we get:

(Rs. 160,000 * 8%) - Rs. 10,000 = Rs. 2,800

This is the same amount as we get if we calculate the tax of each portion of income at the different rates and add them up.

  • That is good information, but the question is specifically about the meaning of the word "less", which you don't address. – BrenBarn Apr 1 '18 at 18:10
  • 3
    @BrenBarn I explained the meaning of all the words in the table, including the word “less.” The question text specifically asks, “explain how does the word ‘less’ work in this context,” and I have attempted to explain how it works. But I have now put the key word in bold. :) – Ben Miller Apr 1 '18 at 18:14
  • @BrenBarn It does address the question, but does so in the middle of the answer. It would be better to put the actual answer at the beginning, then put the expounding on that answer afterwards. – Acccumulation Apr 2 '18 at 16:18
  • I still think the answer to the question is hidden, even by putting minus in boldface, because the relationship to the word "less" is not made explicit. It's like if someone asked what the quadratic formula is and you gave them an algebra textbook :-) All the other information in the answer has nothing to do with the question, because the question is only asking about the single word "less". – BrenBarn Apr 2 '18 at 18:04
  • @BrenBarn If someone asks “What is the quadratic formula?” and I reply by simply reciting the formula, the asker probably hasn’t learned anything, because the asker likely doesn’t know what it is is for and how to use it. – Ben Miller Apr 2 '18 at 18:16

Your Answer

By clicking “Post Your Answer”, you agree to our terms of service, privacy policy and cookie policy

Not the answer you're looking for? Browse other questions tagged or ask your own question.