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What is a neutral fiscal policy?

Fiscal neutrality occurs when taxes and government spending are neutral, with neither having an effect on demand. Fiscal neutrality creates a condition where demand is neither stimulated nor diminished by taxation and government spending.

Read more: Fiscal Neutrality Definition | Investopedia http://www.investopedia.com/terms/f/fiscal-neutrality.aspixzz3rw0Lsl3X Follow us: Investopedia on Facebook

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