Final answer:
Employer tax or levy health funding often results in increased administrative costs for employers and can lead to lower wages for employees as employers adjust compensation to cover these taxes. Payroll taxes in the U.S. are shared between employer and employee and can impact the economics of employment.
Step-by-step explanation:
The question pertains to the payroll tax implications for employers and how it affects not only administrative costs but also employee salaries. When employers are responsible for additional tax or levy health funding, there tends to be an increased administrative cost for these employers. This is due to the complexity and the resources required to manage the additional payroll tax calculations and compliance.
Furthermore, employers may ultimately pass on their share of payroll taxes to employees through lower wages. In the United States, employers and employees split payroll taxes for Social Security and Medicare, with a visible deduction on the employee's paycheck. However, the employer's portion, while not directly deducted from the employee's gross pay, can result in reduced overall compensation as employers adjust wages to account for their share of taxes.
Lastly, it's important to consider the impacts on productivity and growth, as higher taxes can theoretically deter people from working harder due to a higher tax burden. Although this is difficult to measure, the general consensus is that the incentive to work does not significantly decrease because people value their net income even after taxes.