Which of the following is an impact of high taxation on businesses?

High taxation on businesses primarily leads to reduced profit. When companies face higher tax rates, a significant portion of their earnings is taken away, diminishing their net income. This reduction in profit can impact a business in various ways, such as limiting reinvestment opportunities and reducing funds available for employee wages and benefits. Consequently, a business may struggle to maintain growth and competitiveness in the market due to constrained financial resources.

In contrast, increased profit margins and enhanced competitiveness are typically results associated with lower taxation, as businesses would retain more earnings to invest in growth and development. Higher disposable income for consumers usually arises from lower taxation on individuals rather than businesses, leading to more consumer spending. Thus, the correlation between high taxation and the reduction of profits underscores the challenges that businesses face in maintaining profitability under heavy tax burdens.