The 'ideal' line, anyway, is awkward.
For a given point of income representing the minimum wage at which you will demand (net1
) taxes, the line must rise only gradually, lest it discourage opportunities to progress into the taxable arena. Yet everyone seems to consider it fair to have the upper reaches of tax-take be hyperbolic to some final fraction-of-earnings asympotote (some would say that's 100%, many would not, but it offers rising personal rewards whilst to still being a rising contributor to the treasury in a fair-ish way, give or take the details).
Transitioning between the two, though, requires an S-bend inflection. An increasing rise of proportion-per-taxability from the softened lower end meets a declining proportion-per-taxibility as one moves down from the asymptote-kissing levels.
Variable earners in the crux of that curve get hit by more new-taxing-per-unit-earning-increase than anyone else. And they're (by all laws of statistics) likely among the most commonly represented public. Vote losing amongst the middle-classes.
Which is why I have maybe decided to preserve the 'soft lift off' out of the pre-taxable poverty zone, and not
to inflect that line, but merely have its crossing of the "magic" top percentage wherever the toppest-of-all-tops tax-payer sits. It would seem to hurt them, individually, whilst more savvy near-top-earners deliberately hold their pay back (by hook or by crook) to enjoy the proportionally vastly lessened taxation level just shy from that top, but: a) The kudos of being the person paid enough to 'suffer' the full 50% (I'd recommend - no more!) is something to shout about; b) In order to avoid being top, or quite so near it, imagine a set of similarly rich multimillions-earners contriving to effectively donate half a million of their nominal take-homes (dressing it up as business deals/funds reallocations, all they want) to the nominated tax-scapegoat amongst them... Their loss of half a million in pre-tax is rewarded by the (buffed) scapegoater (still getting half of all the effective bonuses 'donated'!) pushing the tax curve further up and away from even their half-mill 'retreat point', giving them yet more relief.
The actual intensity (hyperbolic eccentricity) of the curve used might need fine-tuning to avoid over-scapegoating, but it should be possible to gather everyone's 'bid' for personal incomes (or at least the expected top 25% of earners), create your curve and then demand your taxes (with or without menaces) whilst fining those that break from their 'bids' sufficient to be in the top 1% of specific deniers of expected monies. That's (specifically) going to be the near-top-enders who bid near-near-top but 'inadvertently' earned enough to be near-top (where the difference in pay most affects the treasury income) as well as the reference top-earner who earns less than predicted and thus forces the curve to adjust down.
Anyone (near-top or
top in the original bidding) who breaks above the bid-top with their actual are now paying at >50% (could be >100%, even!), so are already punished by lower after-tax earnings, as are those who bid near-top but got
near-near-top or less, and punitivism won't be useful.
And it doesn't matter how much
income-obfuscation goes on, at the top levels where accountants can be hired to do such things, anything actually legal just tends to bring the curve down, to nobody's benefit, if everybody does it. Illegal evasion of declared income is just as punishable. At the low end of the tax curve (at the soft-start rate-increase of the curve) barely moves regardless of the top-flight's power games. No advantage to have accountants, there, where none could be afforded anyway. The taxes will be within the range of "same ol', same ol'" for a given income above the zero-crossing point, and the bulk of the middle-earners will lie within the elbow, not on as troublesomely steep increase-per-increase as in the S-bended version - aspiration will still be awarded, and a safety-net against down-sizing includes a relief.
Complicated (to get usdd to) , and would need to be set up from scratch, but if we are
talking mad schemes based upon a single principle, then this is mine! 1
Arguments about where the tax line wanders, prior to this value, aside. It could just be asking for zero tax, or it might be implementing a welfare credit/negative tax, and then you wander into "what is a leg-up, what is a reward for earning little?" territory with a vengeance.