<![CDATA[Household consumption plays a crucial role in Indonesia's economic growth, contributing over 50% to Indonesia's gross domestic product. This is reflected in the Indonesian government's monetary policy, which strives to maintain price stability. This study was conducted to examine the role of income in determining household consumption, which is influenced by inflation and taxes. This quantitative study examined the effect of inflation and taxes on household consumption, mediated by income. Path analysis was used in this study. The results indicate that income has a positive effect on consumption. This condition indicates that the higher the household income, the higher the consumption level. Inflation and taxes partially have a significant negative effect on consumption. This condition indicates that the higher the inflation and taxes, the lower the household consumption level. Indirectly, income can mediate the relationship between tax rates and inflation on household consumption levels. This study found that when inflation or tax rates increase without a corresponding increase in income, households' real income for consumption decreases, resulting in reduced purchasing power. This condition will lead to reduced aggregate demand, negatively impacting economic growth]]>
Copyrights © 2026
