A Review of Recent Changes to Fiscal Policy Under the USA Government

This essay provides an analysis of the recent changes to fiscal policy under the USA government, particularly focusing on the tax reforms implemented in 2019. The new tax policy aims to reduce the tax burden for individuals by increasing the tax exemption level and standard deduction. The standard deduction for single taxpayers increased from $6350 in 2017 to $12200 in 2019, and for married taxpayers, it rose from $12700 to $24400. This enhancement is expected to boost consumer spending. However, the policy limits income-related tax exemptions for property purchases and sales to $10000, which will improve government revenue. The bill also eliminates tax penalties for those without health insurance, potentially reducing healthcare costs by over 10%. The essay references scholarly articles to support its analysis of these fiscal policy changes.

Running head: FISCAL POLICY OF THE USA GOVERNMENT
Fiscal Policy of the USA Government
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1FISCAL POLICY OF THE USA GOVERNMENT
Recent change to fiscal policy under the USA government over the last five years
The new tax policy was initially proposed by The USA government in 2018. Afterwards,
it has come into effect in 2019. According to the latest tax reform policy, the alternative
minimum tax will reduce the tax burden for individual. This bill is called for the increase in the
tax exemption level. The standard deduction level for a single taxpayer has been intensified from
$6350 in 2017 to $12200 in 2019. The tax deduction level has been doubled in comparison with
the previous level. Meanwhile, the tax deduction level has been also hiked for $24400 in 2019
compared to the earlier level of $12700. The enhancement in the tax exempted level is expected
to provide a big relief force families and individuals. People will have more money to spend for
commodity and services. This will enhance the consumption power of the consumers in terms of
the standard price-demand theory (Hallerberg and Scartascini 2017). However, this new tax
policy has limited the income related to the purchase and sale of property. The tax exemption
level is limited at $10000, whereas, it was entirely tax deductible for some cases. This will
subsequently help to improve the government revenue. Moreover, the experts assume that tax
exemption will count more number of tax payers following the implementation of new tax law.
Apart from that, the bill has eliminated the tax penalty for them who are not having the health
insurance (Rabe and Mills 2018). As a consequence of that, the healthcare cost will cut down by
more than 10% in the coming years.

2FISCAL POLICY OF THE USA GOVERNMENT
Reference list
Hallerberg, M. and Scartascini, C., 2017. Explaining changes in tax burdens in Latin America:
Do politics trump economics?. European Journal of Political Economy, 48, pp.162-179.
Rabe, B.G. and Mills, S.B., 2018. State energy policy in the Trump Era: insights from public
opinion. Journal of Environmental Studies and Sciences, 7(4), pp.535-539.