What's to believe about the murky middle? There is an optimum tax rate that works for govenment in that if a nation is tax at that rate the maximum revenue to government is maximized.
Not a particularly healthy place for business or the individual however, it tends to lead to high levels of taxation and moribund economies.
Below that tax optimum revenues are lower but the economy grows more rapidily.
Above that tax optimum revenues fall off as the economy dies.
That is all there is. The optimal level of total taxation from a government's view is around 30% of GDP. Tax more your slowing the economy so fast revenues fall off. Tax less the economy picks up and revenues fall, good for the people, good for limiting government.
With the current economy with state and federal tax total is around 27% of GDP, about 10% state the rest federal.
The government, in my opinion, is too close to the nasty optimal. We need to get it down more. Efficiency in government squeezing blood from the turnip is not a good thing.
If I were running things, I would raise some taxes, create new taxes and eliminate other taxes.
A)I'd raise taxes/tariffs on some imports of goods
B)Lower taxes at the middle tax bracket
C)Create tariffs for importation of personnel (H1Bs) and electronic service industries. If a company wants to build a call center in India, fine, but they have to pay taxes on the expertise they're electronically importing.