Whether and how to deflate depends on what you're doing with the data. If you want to compare different years, then you should deflate. It rarely matters much in practise which deflator you use; they should give you similar results. If you are deflating ALL kinds of tax revenue, then use a GDP deflator. If you are using income tax revenue, you might want to use a consumer price index.

Evelyn L Forget thank you mam for your feedback. I will take overall tax revenue data. If i look into the relationship with GDP, i have transformed the GDP series to 2011-12 base. So i think, deflation of Tax revenue is also needed. On the other hand i also wish to check the volatility on it.

Use hte same deflator you used to transform the GDP data.

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