Household consumption, which accounts for about half of Norway’s mainland GDP, depends on various income components, including dividend income. This component has varied widely in recent years due to major changes in the taxation of dividend income. In 2006, dividend income accounted for 1% of household disposable income, while the share in the 4th quarter of 2021 was 19%. We show that in order to make good projections of household consumption—and thus GDP—it is crucial to decompose dividend income into permanent and transitory dividend income, where the latter component depends on adaptations to changes in the taxation of dividend income. We also show that the predictions of consumption based on a model with dividend-adjusted disposable income are more precise than predictions from a model employing the standard measure of real disposable income.