I'm confused what exactly this penalty refers to?
For example, if you double tax rates, revenue will less than double due to economic distortions.
What exactly do you mean by economic distortions? Also isn't this idea mostly debunked?
I'd assume if you double tax rates for everyone there would be some detriment. Less for people to spend means small businesses earn less, leading to some downsizing which leads to less earnings etc. I think most of the debunking is about the highest earners specifically.