Labour taxes encourage workers to work fewer hours, second earners to stay at home, the elderly to retire early, and the unscrupulous to engage in illegal activities.

Question

Quizplus · Accepted Answer

Labour taxes increase the cost of labour for employers, which may lead to reduced demand for workers and result in reduced hours or job losses. This can discourage second earners from entering the workforce and may encourage early retirement for older workers who have reached the age of retirement. Additionally, if labour taxes are excessively high, some individuals may resort to illegal activities to avoid paying taxes.

Labour Taxes Encourage Workers to Work Fewer Hours, Second Earners