Calculate the cash tax rate, which measures the percentage of pretax income that is actually paid out in cash taxes, as opposed to the accrual-based effective tax rate.

The formula is as follows:

\[\text{Cash Tax Rate} = \text{Income Taxes Paid} / \text{Income Before Tax}\]

Also known as: cash effective tax rate.

No programming experience? With the Finance Toolkit MCP server, AI assistants such as Claude and ChatGPT can calculate the Cash Tax Rate for you. Just ask in plain English.

Calculate the Cash Tax Rate in Python

The Cash Tax Rate is available in the Ratios module of the open-source Finance Toolkit. Install it with:

pip install financetoolkit -U

Then call get_cash_tax_rate as shown below.

from financetoolkit import Toolkit

toolkit = Toolkit(["AAPL", "TSLA"], api_key="FINANCIAL_MODELING_PREP_KEY")

cash_tax_rates = toolkit.ratios.get_cash_tax_rate()

Which returns:

  2021 2022 2023 2024 2025
AAPL 0.2324 0.1643 0.1642 0.2114 0.3267
TSLA 0.0884 0.0877 0.1122 0.1481 0

Parameters

get_cash_tax_rate accepts the following parameters:

  • rounding (int, optional): The number of decimals to round the results to. Defaults to 4.
  • growth (bool, optional): Whether to calculate the growth of the ratios. Defaults to False.
  • lag (int | str, optional): The lag to use for the growth calculation. Defaults to 1.
  • standardize (bool, optional): Whether to standardize (Z-Score) the result. When combined with growth=True, standardizes the growth values instead of the raw values. Defaults to False.
  • trailing (int): Defines whether to select a trailing period. E.g. when selecting 4 with quarterly data, the TTM is calculated.
Income Quality Ratio Return on Tangible Assets (RoTA) Return on Capital Employed (RoCE) Net Income per EBT Free Cash Flow Operating Cash Flow Ratio Tax Burden Ratio EBT to EBIT EBIT to Revenue Tax Rate Divergence EBITDA Margin Free Cash Flow Margin Cash Return on Assets (CRoA)

The Ratios module page introduces the module, and the sidebar lists all of its functions.

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