Since income tax revenues will rise (fall)as expenditures and output increase (decrease)the income tax results in

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Income taxes automatically adjust with changes in income, acting as an automatic stabilizer by dampening the fluctuations in GDP. They also reduce the multiplier effect because part of the increase in income is taxed away, leading to a smaller increase in consumption and investment than would occur without taxes.

Since Income Tax Revenues Will Rise (Fall)as Expenditures and Output