The primary objective of a tax credit is to encourage businesses to behave in certain ways. One example is offering a tax credit to automobile manufacturers for the purchase of robotics used in the manufacture of automobiles.

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Taxes or tax credits can be used to discourage or encourage taxpayers to behave in particular ways. The government may encourage businesses to hire new employees or purchase new equipment by offering a tax credit. A tax credit is an amount that can be deducted from a tax bill.

The Primary Objective of a Tax Credit Is to Encourage