particular tax– policy on economic activity and tax revenue. We add an informal sector to the Bank of Greece DSGE model and use … tax rates increased by much more and tax revenue by much less than predicted. The model replicates the official output …

changes in the tax mix influence economic activity and welfare in the Greek economy. The results suggest that tax reforms that … reduce the labour and capital income tax rates and increase the consumption tax rate lead to higher levels of output …, consumption and private investment. If the goal of tax policy is to promote economic growth by changing the tax mix, then it …