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Glossary   >   F   >   "Fiscal policy" Definition            Fiscal policy The use of government spending and taxing for the specific purpose of stabilizing the economy. The use of spending and taxation by the government in order to achieve its economic objectives. Put simply, higher taxation reduces people"s disposable income, and suppresses spending which is supposed to make inflation less likely. Glossary    Dictionary Search (powered by Google) WWW ITLOCUS.COM GLOSSARY.ITLOCUS.COM Translate a web page (powered by Google)      to German Spanish French Italian Portuguese Japanese Korean Chinese

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Fiscal policy - The use of government spending and taxing for the specific purpose of stabilizing the economy.

The use of spending and taxation by the government in order to achieve its economic objectives. Put simply, higher taxation reduces people"s disposable income, and suppresses spending which is supposed to make inflation less likely.