This study examines how the tax system in the City of Austin has responded to the economic and demographic changes it experienced during recent years. The industrial structure of Austin experienced the major shift and workforce became more educated. Most of new jobs were created in the higher earning industries. Sales tax, property tax and utility transfer are major revenue sources of Austin. It was found that Austin became more reliant on the sales tax. The result of regression analysis shows that the tax system of the City of Austin has been well responsive to the economic and demographic changes. It was also found that sales tax is more sensitive to economic changes whereas property tax is more sensitive to demographic changes.
-- Author's foreword.