With a payroll tax, the product being taxed is labor and its price is the wage rate. Applying the insights obtained from the analysis of excise taxes, the relevant question is whether firms’ demand for labor or workers’ supply of labor is more responsive to changes in the wage rate. In the long run, it is likely that firms are more responsive, or flexible, particularly in a global economy in which they can relocate abroad. This conclusion implies that employees bear most of the payroll tax burden, a result supported by empirical studies. In other words, wages paid to employees are lower by an amount roughly equal to the employers’ part of the payroll tax. In accord with this conclusion, official distributional analyses generally assign the full burden of payroll taxes to employees. The primary controversy in this area concerns whether the distributional analysis should also include the Social Security benefits that are financed by the payroll tax.
This conclusion implies that employees bear most of the payroll tax burden, a result supported by empirical studies. In other words, wages paid to employees are lower by an amount roughly equal to the employers’ part of the payroll tax.
Unfortunately in order for any tax to be paid or a wage paid, revenue must be available to pay those wages. As I said, all taxes are reflected in the price of goods, or the business must of necessity cease operation. If a business cannot price products so they sell, there is no business, there is no wage to pay, there is no payroll tax to remit.
Wages for employees may be lowered by some factor because product sales cannot support the wage plus the employer's excise, that does not invalidate the fact that both the wage and the tax is derived from the price of goods that can be sold to keep the business in existance.
The business employer's excise is paid out of sales revenues right along with the gross wage actually paid to the employee. The customer pays for it all.