What are the important objective of fiscally policy of modern government?
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fiscal policy is a policy under which the government uses its expenditure and revenue programs to produce desirable effects and avoid undesirable effects on the national income, production, and employment. the following are the main objectives of fiscal policy:
1)Social Justice- fiscal policy should be used as an effective means of achieving the goal of equity that is making The distribution of income and wealth equitable. the government can achieve Social Justice by imposing higher rate progressive taxes on rich and giving subsidies and concessions to lower income and middle income groups.
2) economic stability- price stability here means relative price stability. the situation of inflation should be curbed and deflation should be avoided.
3) full employment- public expenditure has to be incurred in a planned way To finance public Wok programs and provide social security measures.
4) economic growth- by reducing direct taxes the government can induce investors are entrepreneurs to increase the rate of Investments which will automatically increase production employment and income generation. on the other hand by bringing about an increase in public expenditure on infrastructure etc the government can accelerate the rate of economic growth.
1)Social Justice- fiscal policy should be used as an effective means of achieving the goal of equity that is making The distribution of income and wealth equitable. the government can achieve Social Justice by imposing higher rate progressive taxes on rich and giving subsidies and concessions to lower income and middle income groups.
2) economic stability- price stability here means relative price stability. the situation of inflation should be curbed and deflation should be avoided.
3) full employment- public expenditure has to be incurred in a planned way To finance public Wok programs and provide social security measures.
4) economic growth- by reducing direct taxes the government can induce investors are entrepreneurs to increase the rate of Investments which will automatically increase production employment and income generation. on the other hand by bringing about an increase in public expenditure on infrastructure etc the government can accelerate the rate of economic growth.
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