I depends on the requirement where we use it.
Proc Report allows calculations involving input variables so you can have a column of output related to sums/difference/ratios/ whatever between the values of varibles. Proc Tabulate cannot do this except for some very limited percentages. Proc tabulate allows for multiple levels of nesting of categorical variables in both column and row dimensions with Proc Report doesn't.
I use proc tabulate when we need to produce matrix-style reports which is preferred. with proc report we can producecolumnar-style report.
Another important distinction is that PROC TABULATE only produces summary reports (one report row represents a group of observation's statistics) while PROC REPORT can produce either detail (one report row = one observation) or summary reports. PROC REPORT can add extra summary lines using a LINE statement at certain break points on the report. And, PROC REPORT can do trafficlighting based on more than one condition (using and IF statement and CALL DEFINE).
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