What is fiscal policy?
Fiscal policy is policy about income and expenditure (budget) of government. In income of government will come from getting tax in any kind of tax. For example personal tax, corporate tax and consuming tax or value added tax (VAT) or get from who have income in nation such as personal tax and some of other kind of tax come from luxury goods such as alcohol, Cigarette, card and from import tax such as automobile, perfume, watch and cosmetics.
Receive tax and how money goes?
Infrastructure budget; the amount of tax that government can get from population government will spend in consumption and investment following budget that have been set in each year. In normally will spend in government work such as build road, buy weapon and develop other economic section. The most is spending more in factor of infrastructure but stimulate the economic or sometime using in creation of weapon for military and some goods that private sector not produce or sometime call “Public goods” ex. Military, build road, garden, overcrossing, etc.
Why should to have fiscal policy?
In the main task, fiscal policy is a tool in maintain stability and expanding of economic. That are in the period of good economic; tax that get by government will have more in automatic. Such as value added tax will receive from consumption of goods and service for 7% of the real price of goods and service. If economic can growth in high direction the tax that government got will high as well. But if bad economic government can spend money from the tax that having got in stimulate economic. We can call this action is maintain stability.
Then, when there are good economic can compare with the car that go fast the getting of tax mean to break the car for slowdown and reduce accident and when the car go slow or bad economic it will affect to unemployment and government will spend the tax that got to stimulate the economic it mean the car will speed faster. However if government spend money in worst way will not being of Productivity and finally the money from tax that spend out will just have benefit for short time but in long time economic will not got anything.
Expansionary fiscal policy
Expansionary fiscal policy is the time when government spend budget more than the value of tax received can call deficit budget. This tool will using when occur of deflation or economic retreat for stimulate economic which government spend money more than receive tax. It will be injection of money to economic system such as to reduce value added tax from 10% to 7%. The population will have more money in spending.
Contractionary fiscal policy
Contractionary fiscal policy is the time that governments spend money less than income of tax that can receive or can call over balance. If we can choose this tool when inflation occur in economic when government want to spend money less but keep more tax. It similar the sucking of money out from economic system. It can reduce the inflation in economic.
ไม่มีความคิดเห็น :
แสดงความคิดเห็น