Psychotext wrote:This is just diminishing returns, it would happen regardless of tax rate. Where your basic needs are met at some point the additional effort you make stops being worth the reward (unless you are person who lives to work as most of the great entrepreneurs are). As you have less free time it becomes more valuable and your friends just made an intelligent trade off.Dante_Cubit wrote:You might think so, but I personally know two people who decided that their time was better spent on leisure at that point rather than earning more (both self employed).
No-one gets to a quid below the higher rate threshold and says "That's it, I'm treading water from now on". That just isn't how it works.
Now that's not quite the same as just "treading water", but the tax rate did basically push them to the decision of not working any harder.
Edit - I know a third person who started a charity in another country and donates all of his income to that instead... it doesn't really take a brane scientician to work out something fishy is going on there.
And let's be honest, the world would be a better place if people spent more time doing things other than paid work. Time with family or spent on artistic or intellectual pursuits enriches society as a whole. The notion that GDP is a good measure of anything other than economic activity has been disproven time and time again.
Edited by Dante_Cubit at 23:02:17 02-01-2013