Effective capital gains tax

ECG= tcg*(1-pi-pd-pcg)/(1-pi*ti-pd*td-pcg*tcg)

why divide by the denominator? I don’t see the logic and intuition

It is not really explained to my knowledge but the reason behind it is that it is also needed to adjust for the fact that we have over the past years already paid taxes on short-term capital gains, interest, dividends etc.