In: Economics
Solution -
Pay roll tax is given to the workers by the salaried companies. In this way, one of the programs which are limited to workers is a strong tax-benefit link. In that case, the tax affects every worker (changing the demand curve) to lesser workers for less workers but the workers' willing to accept lesser wages are affected because they benefit from the funding program through the salaried tax (supply) changes the curve as well.Both of these results are less under labor pressure, so instead of reducing the level of workers in taxation cases, workers are transferred to workers in lesser form.
If all the benefits are available through tax to the citizen, then there will be no suitable shift in the supply of labor work (because the workers will not have any additional benefit), therefore the minimum loss will be higher but the wages will not be reduced.Workers do not tolerate much of taxation when there is no profit with the performance status.
The benefits provided are the difference by the response to labor supply. If the labor wages do not respond to the new benefits by reducing the wage and will not be less responsive to the new benefits, then the lesser labor will be less able to pay the tax on the entire expenditure of the workers. On the other hand, if the beneficiaries benefit from subsidized subsidized wages, they will be more willing to accept lower wages instead of getting benefits.
In this way, the difference between these two programs will be particularly large when the benefits are considered by the workers or workers are more likely to be the beneficiaries of the benefits.