Definition of "ad valorem"

"'I forgot to tell you, boys,' says he, 'that Nicaragua slapped an import duty of 48 per cent. ad valorem on all bottled goods last month.

c. 1900, O. Henry, The Lost Blend

[…] the medical attaché is known among the shrinking upper classes of petro-Arab nations as the DeBakey of maxillofacial yeast, his staggering fee-scale as wholly ad valorem.

1996, David Foster Wallace, Infinite Jest […], Boston, Mass., New York, N.Y.: Little, Brown and Company, page 33