Answer:
Fiscal policy refers to the use of government spending and tax policies to influence economic conditions, especially macroeconomic conditions.
Fiscal policy tools are used by governments to influence the economy. These primarily include changes to levels of taxation and government spending. To stimulate growth, taxes are lowered and spending is increased. This often involves borrowing by issuing government debt.
In the short term, the governments may focus on macroeconomic stabilisation by cutting taxes and increasing spending to boost a weak economy or increase taxes and reduce spending during inflation. In the long term, it may focus on sustainable growth and the reduction of poverty.