An example of an incentive program a government may use to stimulate the economy is __________.
Answers
Answer:
Tax Incentives.
Explanation:
Tax incentives—also called “tax benefits”—are reductions in tax that the government makes in order to encourage spending on certain items or activities. Tax incentives are often cited as a great way to encourage economic development. For example, a common individual tax exemption in the United States is the mortgage interest deduction, which ensures money paid toward mortgage interest isn’t counted as taxable income. This incentivizes people to buy property. An example of a corporate tax incentive is a government giving a major company tax breaks in exchange for them building an office or plant in their city. This type of tax incentive stimulates the economy in that area by empowering the company to provide jobs, as well as make goods or services available for purchase.