Posted: February 19th, 2022
Options for Reducing Debt Levels
There are numerous strategies that the government can use to reduce the debt levels. These measures include increasing taxes. One of the impacts of increased taxes is that it enhances the revenue levels. In this case, the government will have more money to pay off the debts. However, taxes must have a ceiling to avoid excessive taxation. Another way of managing debt is by the government lowering spending. For instance, the government can focus on only those below a specific budget and postpone those projects with huge budgets to a later date when the economy is stable (Perret & Van Dender, 2020). Another way of reducing the debt levels is by growing the economy. The government can grow its economy through the different fiscal policies. Increasing investment in the sectors that continue more to the revenues is one of the ways of increasing the tax base. With more revenues, the government can pay off its debts effectively.
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