Sliding scale fees are variable
price
A price is the (usually not negative) quantity of payment or compensation expected, required, or given by one party to another in return for goods or services. In some situations, especially when the product is a service rather than a ph ...
s for products, services, or taxes based on a customer's ability to pay. Such fees are thereby reduced for those who have lower incomes, or alternatively, less money to spare after their personal expenses, regardless of income. Sliding scale fees are a form of
price discrimination or differential pricing.
A business or organization may have various motivations for pricing a product or service on a sliding scale. These may include the desire to be charitable to those less able to afford the product or service, their ability to get a
tax deduction
A tax deduction or benefit is an amount deducted from taxable income, usually based on expenses such as those incurred to produce additional income. Tax deductions are a form of tax incentives, along with exemptions and tax credits. The diff ...
for offering their services as
charity
Charity may refer to:
Common meanings
* Charitable organization or charity, a non-profit organization whose primary objectives are philanthropy and social well-being of persons
* Charity (practice), the practice of being benevolent, giving and sha ...
, their ability to benefit from the
revenue
In accounting, revenue is the total amount of income generated by the sale of product (business), goods and services related to the primary operations of a business.
Commercial revenue may also be referred to as sales or as turnover. Some compan ...
even from a
partial payment, their retention of a longtime customer/client, or referrals that such a customer/client may provide.
For example, healthcare providers sometimes offer a sliding scale of fees to patients. Some child-adoption agencies collect legal fees (normally very expensive) on a sliding scale, so that couples across a wider range of incomes are able to adopt children. Sliding-scale fees are also often charged by
lawyer
A lawyer is a person who is qualified to offer advice about the law, draft legal documents, or represent individuals in legal matters.
The exact nature of a lawyer's work varies depending on the legal jurisdiction and the legal system, as w ...
s, places of
worship
Worship is an act of religious devotion usually directed towards a deity or God. For many, worship is not about an emotion, it is more about a recognition of a God. An act of worship may be performed individually, in an informal or formal group, ...
, and for
tuition at educational institutions.
[ Thursday, 24 August 2017 ]
See also
*
Pay what you want
*
Price discrimination
*
Sliding wage scale
*
Progressive tax
A progressive tax is a tax in which the tax rate increases as the taxable amount increases. The term ''progressive'' refers to the way the tax rate progresses from low to high, with the result that a taxpayer's average tax rate is less than the ...
References
{{Econ-stub
Costs
Fees