[mrweasel]

So your boss wants to give you a $1000 raise, but you don't want it, because you'll only get the $400 and the rest is just tax? At no point will taking the $400 impact what you're already making or how it's taxed. Even the Danish government isn't stupid enough to implement a system where your existing income is reduced, because you get a raise.

Again I see the point if you're offered or able to get some kind of benefits or vacation time instead. That may easily be of greater value to you. That's just not often an option.

Edit: If it helps: A progressive tax is what the US have. India may as well, that I don't know.