When taxes are deducted from employees' earnings up to the same amount of taxes they would pay had they remained in their home country, it is known as _____.

Question

Quizplus · Accepted Answer

This is known as tax equalization, where the employer ensures that the employee does not pay any more or any less taxes than they would have paid had they remained in their home country. This is to ensure fairness and consistency for employees working in different countries. Option A (expat tax) is incorrect because it refers to a tax specifically levied on expatriates, which is not the same as tax equalization. Options C and D (compensatory tax and tax protection) are not commonly used terms in the context of tax deduction for expatriates.

When Taxes Are Deducted from Employees' Earnings Up to the Same