Budget and tax instruments of budget deficit regulation

Abstract

Fiscal policy in Ukraine is constantly in the spotlight of economists due to the course of European integration of our country. In unstable economy conditions it is necessary to develop new conceptual approaches to the directions and mechanisms for implementation of fiscal instruments to ensure effective socio-economic development in general and economic growth in particular. The purpose of the article is the analysis of the main tools of fiscal policy and their economic activities in the state. The article reviews the types and directions of use of fiscal instruments regulating the budget deficit. It has been  investigated the relationship of the budget deficit and economic growth. It has been outlined the relationship of the budget deficit and economic growth, which is that, despite the great importance of the state budget economic growth still remains more priority one. The paper has emphasized that fiscal instruments are basic in providing state funds that are necessary to carry out its functions. That is, use of  fiscal instruments can effectively regulate state revenues and expenditures, encourage or restrict entrepreneurial activity, affect inflation and unemployment.