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I think the parent was referring to effective tax rate. Tax rates are applied in graded steps, so you will only pay 40% on income over a certain amount.

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As your total income rises, your effective tax rate converges to the headline marginal rate.

(Granted this is a mathematical problem for millionaires, but still...)

Except that the truly rich tend to get most of their income from capital gains rather than wages and salaries, and there's a much lower rate for capital gains than for earned income. The "Buffet pays a lower tax rate than his secretary" problem.

Quite, though the arrangements vary from place to place.

There's a lot distortion and unseemly outcomes that flow from having misaligned personal, capital gains and corporate tax rates.

Unless you pay the AMT.

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