The Macroeconomic Effects of Income and Consumption Tax Changes

• 成果类型: Article
• 署名作者: Anh D M Nguyen; Onnis, Luisanna; Rossi, Raffaele
• 署名单位: Bank of Lithuania; Vilnius University; University of Huddersfield; University of Manchester
• 刊物名称: AMERICAN ECONOMIC JOURNAL-ECONOMIC POLICY
• ISSN/ISSBN: 1945-7731
• DOI: 10.1257/pol.20170241
• 发表日期: 2021
• 页码: 439-466
• 关键词: monetary-policy; fiscal-policy; heteroskedasticity; multipliers; taxation; GROWTH; cuts

摘要

This paper estimates the effects of exogenous changes in income and consumption taxes. The tax shocks are proxied with a narrative account of tax liability changes in the United Kingdom. Income tax cuts have large effects on GDP, private consumption, and investment. The effects of consumption tax cuts are modest and not statistically significant on GDP and its components. Shifting the burden of taxation from income to consumption is expansionary. Consistent with conventional public finance theories, these results indicate that it is crucial to distinguish between direct and indirect taxation when studying the transmission mechanism of fiscal policy.