Thoughts on Tax

With the end of the financial year approaching, I have been giving some thought to the "lower taxes" message that seems synonymous with conservative / liberal politics.

 We are given the message that lower taxes stimulate growth but with some thought this seems paradoxical to me.

First as I understand it, Growth is in essence more economic activity.  More stuff being made and bought more services being offered and consequently consumed. 

So at first glance it would seem that lower taxes would put more money in peoples pockets to spend and hence more consumption and more economy.  I think this is true for low and middle income people who are essentially living from pay to pay and don't have spare money for discretionary spending.  It would seem to me that for rich people, this is not the case.  For rich people, lower taxes and consequently more money does not necessarily translate to more spending because they already have enough money to buy whatever they want.  

Now rich people are the people with the resources to fund investment, R&D and so on.  

I think there is an argument to say that the rich people and companies should actually be subject to a much higher marginal tax rate.  People hate paying tax and do what they can to pay less tax.  Remember that tax is paid on profit.   So a high tax rate provides a motivation for people to spend some of their money on things that can be expensed like borrowing to invest and R&D come to mind.