5 Advantages of Fiscal Policy to The Malaysians Economics

1.Systematic Development

 Nowadays,developers will construct a lot of buildings when the tax is lower without
doing the feasibility study on their target market .
 When the tax is high , they will realize that they need to construct only an important
building to save their money and prevent loss.
 So, the developer will get more profit because knowing the real target market .

2.Generate National Income

 National Income can be increase rapidly when the governemt get the money from the
people on the country.
 For example , when the government increase the tax , government will get a lot of money
to grow the country’s activities.
 When the national income increase , government can provide many facilities and fulfill
the public need .

3.Generate economic of other sectors activities

 When the tax is low , the demand will be high.People will quickly spend money and buy
many thing from many sectors.
 For example , if demand is high , the production sectors will supply more final goods to
gain profit and increase the production sectors .
 On the other hand , housing sector will also gain profit because people will spend more to
buy house before the tax become high and it will increase the housing sectors activities.

4.Job opportunities

 Like we know , when the tax is lower , the spending will be high.This make the
production sectors will increase more final goods to fulfill the wants .
 Production need to hire more workers and its create more job opportunities to the people
and increase their starndard of living .
 When the workers is lot , so the final goods will be high and it will increase the profit to
the production sectors .

5.Reduce inflation

 Inflation occurs when the demand is high but limited supply .

 When the government increase the taxes , so the demand will reduce and it will make the
country in a stable condition.
 For example , when unemployment rate is too low , the government need to increase the
tax to stabilize the employment rate and it will reduce the inflation.