Taxes increase as GDP rises. This is an example of an automatic stabilizer.

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Automatic stabilizers are government programs or policies that are designed to reduce the impact of economic fluctuations on individuals and businesses without any explicit government action. Taxes are one of the most common automatic stabilizers. As the economy grows and GDP rises, people's incomes increase and they pay more in taxes, which helps reduce inflationary pressures and stabilizes the economy. Conversely, during an economic downturn, incomes and tax revenues decrease, which can help to stimulate demand and reduce the severity of the downturn.

Taxes Increase as GDP Rises