Definition

1. Adverb & Adjective:
   • In proportion to the estimated value of the goods taxed: Used to describe a tax or duty that is calculated as a percentage of the value of the item being taxed, rather than as a fixed amount per unit.

Usage

• As an adverb: Modifies a verb, describing a tax is levied.
• As an adjective: Modifies a noun, describing the of tax or duty.
• This term is primarily used in legal, economic, and trade contexts.

Examples

• Adverb:

  • The customs duty is applied ad valorem.
  • Goods imported for commercial use are taxed ad valorem.

• Adjective:

  • An ad valorem tax is common on imported items.
  • The new legislation introduced an ad valorem duty on luxury vehicles.

Advanced Usage

• "ad valorem tariff": A tariff rate expressed as a percentage of the value of the imported goods.

  • The country imposes a 10% ad valorem tariff on electronic goods.

• "ad valorem equivalent": The percentage rate that a specific duty (a fixed fee per unit) represents relative to the value of the goods.

  • Economists calculated the ad valorem equivalent of the specific duty on wheat.

Variants and Related Words

• Ad valorem duty (n): A synonym for an ad valorem tax.
• Ad valorem rate (n): The percentage used to calculate the tax.

Synonyms

• Value-based: Describing something calculated on value.
• Proportional tax: A tax that takes a fixed percentage of value (Note: This is a broader economic term).

Related Phrases

• Ad valorem taxation: The system or practice of levying taxes based on value.
  • The state relies heavily on ad valorem taxation for its revenue.

Notes

• The phrase is Latin, meaning "according to value." It is often used without italics in modern English legal and economic texts.
• It is the opposite of a specific tax, which is a fixed amount per unit (e.g., $5 per kilogram), regardless of the item's value.

Adverb

1. in proportion to the estimated value of the goods taxed
   • the goods were taxed ad valorem