What is fiscal policy?

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Meaning of Fiscal Policy

Fiscal policy is defined as the means by which a government adjusts its levels of spending in order to monitor and influence a nation’s economy. In other words, it is the policy for the government revenues, public expenditures, and borrowing to meet the goals targeted by the government. Generally, the government uses fiscal policy to promote strong and sustainable growth and reduce poverty.

Objectives / Goals of fiscal year

Following are the objectives of the fiscal year

  1. Full Employment.
  2. Economic growth and development.
  3. Price stability.
  4. Reduction in inequalities of income and wealth distribution.
  5. Capital formation
  6. Economic formation
  7. Economic stability

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