Custom pricing formula in Price list and modifiers

Hi Pricing guru's

Scenario:

We have a requirement to apply a product tier based discount based on YOY growth

If customer gets 10% YOY growth -- customer gets 2% discount on list price

if customer gets 20% YOY growth - customer gets 4% discount on list price

When i use the custom pricing formula with calculation, what is the expectation from the formula i.e. is the pricing engine expecting a growth rate using which it will determine the discount or is it expecting a discount rate?

Discount tiers:

1 to 10 -- 2%

11 to 20 -- 4%

Formula example:

Step 1: gets YTD sales for 2014 year for customer on sales order