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What fiscal policy means

What fiscal policy means

Flowchart showing how cutting or raising taxes and spending changes disposable income, expenditure, output, inflation and the budget balance

Fiscal policy is the use of government taxation and government spending to influence the economy. Government spending includes items such as schools, the NHS, benefits and infrastructure, while taxes remove money from households and firms.

Fiscal policy Lesson

  1. GCSE
  2. /Economics
  3. /Fiscal policy