There's a good deal of evidence that what matters to "incentive to work" is pretax income, actually.
And then there's the obvious fact that if you reduce people's net income by taxation you give them an obvious incentive to work more so the net is higher! I think Geoffrey Hazard once wrote a paper about that, no one paid any attention.
Also there's the curious point about diminishing marginal returns ("DMR") that advocates of unlimited accumulation never get. An extra 50 dollars is a lot of money to someone earning $33,000 a year, like teachers in Waukegan, IL, but because an extra million dollars is chicken feed to Bill Gates, it doesn't provide him any significant additional incentive to monopolize the software market and violate the antitrust law bundling bad software that you have to buy. So, if you think that people are mainly motivated to work by extra money, and you want people to work, you want your incentives front-loaded, progressivity is a reflection of this obvious fact.
Fact is, we don't provide incentives to work, mainly, by giving more money, except to them as don't need it because (a) their jobs are relatively desirable, intrinsically rewarding, or compensated in nonmonetary terms (like prestige), or (b) because DMR means that extra money doesn't matter that much to them as income as opposed to a way of keeping score.
We do it on the One Bullet Manager theory that Terrified People Are More Productive: for most people it's not the carrot of extra income, but the stick of joblessness and destitution that drives them to the rat race.
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