Income tax has an absolute effect when you look at it mathematically.
"Oh hey look, since the taxes I have less money and despite what I want, I'm not going to hire!"
But companies don't set prices and quantity by tax policy, they set marginal revenues to marginal supply.
here is an example.
You earn $100k profit. It cost you $10k to hire a new person and he produces revenues of $30k. You are now taxed at 10% of profits ($10k currently) and let's say all non-worker costs from added production is $5k (more supply = more shipping or something).
An extra worker would net you $15k pre-tax and you pay $1500 of that in taxes leaving you at $13.5k in added pre-tax profit. Now you earn $115k in pre-tax profits and $103.5k in total take home money.
So you obviously hire this new person.
Now, let's say I double the taxes to 20% of increased income. Well, you pay $20k in taxes. The worker still provides the same stuff. Now you still earn $15k pre-tax but pay $3k in taxes leaving you with $12k in taxes on the new income.
Your pre-tax profits go from $80k to $92k.
you still hire a new worker. Your profits are smaller but your decision is unchanged. You are trying to profit maximize, not tax minimize!
The taxes don't affect this, mathematically. They can't, because they are taxed on profits, not revenues. And the first rule is you set marginal revenues to marginal costs and income taxes play no part in either (other taxes do, however, like property and sales).
And let's say I don't have the money to hire a new person. Well then, I'll borrow it if it still nets me profit, right? Why wouldn't I?