The Heritage Foundation has published Tax Day 2011: Deficit Spending Hides Future Tax Hikes, by Curtis S. Dubay:

To collect the additional revenue necessary to close the 2010 deficit, income tax rates would have to have been considerably higher than their current levels. Without altering other aspects of the tax code, if Congress collected the extra revenue by simply hiking each income bracket based on its portion of current tax collections, every tax rate would need to more than double.

 

President Obama has long said that he would not raise income taxes on any family earning less than $250,000 a year. That roughly corresponds to the top two income tax brackets. If, instead of raising taxes at all income levels, Congress collected it from just those making $250,000 or more per year, their rates would have to rise to levels that are not even possible. The top two rates would need to rise to 132% and 142%.

Of course, it is impossible to tax at a rate over 100%. Doing so would require confiscating savings, investment, or even other assets. Moreover, as a practical matter, it is impossible to get even close to 100% and still raise revenue because businesses, workers, and investors would simply stop producing, working, and investing as the government came close to confiscating almost every additional dollar they earned. Much of their economic activity would be driven underground.