Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/248370 
Year of Publication: 
2021
Series/Report no.: 
WIDER Working Paper No. 2021/156
Publisher: 
The United Nations University World Institute for Development Economics Research (UNU-WIDER), Helsinki
Abstract: 
This paper analyses the macroeconomic effect of legislated personal income tax changes in South Africa over the 1996-2019 period. We identify personal income tax shocks using a narrative approach and incorporate these shocks in a proxySVAR model. Our analysis shows that permanent changes in personal income taxes have a larger and significant effect on output through both the investment and consumption channels. We also find that personal tax cuts have a persistent effect on output through the investment channel in the 1996-2010 sub-sample.
Subjects: 
tax changes
narrative approach
proxySVAR
macroeconomic effects
South Africa
JEL: 
C32
E23
E62
H24
Persistent Identifier of the first edition: 
ISBN: 
978-92-9267-096-2
Additional Information: 
Note: On 22 November 2021, missing acknowledgements were added.
Document Type: 
Working Paper

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