You're right in both cases, but that it is a rationalization by employers doesn't make it less likely to happen, does it?

What I am saying is that if the tax rate is 0%, the company will not pay you $50K gross. It will offer you $25K gross. If the tax rate is 50%, it will offer you $50K gross knowing that you will only get $25K net.

The corollary is that if the tax rate fell from 50% to 0%, the company would try to get their $50K gross employees to accept, say, $30K gross. It would still be an income increase for the employees but an even greater cost decrease for the company. New hires would definitely get $25K offered.