Income tax and other statutory deductions made by the employer from the employee's gross salary or wages.
Use 'payroll tax' in a Sentence
When someone hires a bunch of workers they must take a payroll tax out of the money they will pay to their workers.
Jeff was confused when his paycheck amounted to much less than he had anticipated, but his supervisor explained that the deductions were due to payroll tax.
The good thing about the payroll tax was that it was automatically taken out of the employee's gross wages which meant that the employer didn't have to manually deduct it.
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