hello everyone,

Could anyone help me understand how the tax system works?

If my taxable income is 2.000.000 NTD, how will I be taxed?

Will it be

0 to 370000 x 6% - 0 = 22000

370001 to 990000 x 13% - 25900 = 54700

990001 to 1980000 x 21% - 105,100 = 102800

1980001 to 2000000 x 30% - (pro rata 283300) = let’s say 4000

total tax = 184000

–> 9% average tax rate

OR

2)

2000000 x 30 % = 600000 - 283300 = 316700

–> 16% average tax rate

What I need to know is whether the progressive difference is cumulative or whether it is taken as a lump sum when you reach a particular bracket.

This is confusing as the way the tax scale is presented is that you remove the progressive difference in each scale