Endogenous fiscal policies typically aim to counteract macroeconomic shocks that could alter the trajectory of long-run economic growth. For instance, a tax reduction in- troduced to stimulate the economy in anticipation of a recession is considered endogenous, as it seeks to mitigate non-policy influences on economic dynamics. Such tax amendments are thus classified under the ”endogenous” category.

Three distinct sub-categories of endogenous tax changes are identified:

1. Spending-driven Changes: These adjustments are initiated primarily to fund specific government programs. An example is the increase in the Medicare levy surcharge in 2013, expressly aimed at financing the Disability Care Australia Fund.

2. Deficit-driven Changes: Motivated by concerns over short-term fiscal sustain- ability, these alterations often respond to deficit issues. The 2014 introduction of the Temporary Budget Repair Levy on high-income earners, a response to deficits stemming from the Global Financial Crisis, is a notable case.

3. Counter-cyclical Measures: Aimed at countering non-policy-driven economic fluctuations, these policies are tailored to stabilize standard economic growth pat- terns. The 2008 National Building and Jobs Plan, formulated to support employ- ment and growth during the Global Financial Crisis, exemplifies this category.