Discretionary tax changes and the macroeconomic activity: New narrative evidence from Australia

Vol: 
6/2024
Author name: 
Ge, C
Year: 
2024
Month: 
April
Abstract: 

This paper examines the impact of discretionary tax changes on economic activity in Australia. I use written records such as Budget Report and Election Speeches to identify the revenue effect, timing and motivation of all major Commonwealth tax policy actions from 1975 to 2018. This approach allows me to isolate legislated tax changes that are taken for exogenous reasons. My main finding reveals that tax cuts are ineffective in stimulating economic output in Australia.

Publication file: 

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