FISCAL POLICY AS A KEY TOOL FOR THE ECONOMIC GROWTH OF THE COUNTRY

Abstract

This paper examines fiscal policy as a key instrument for economic growth under macroeconomic instability and fiscal constraints. The research is justified by persistent budget deficits, rising public debt, reliance on external financing, and the need to balance short-term stabilization with long-term development, particularly during post-war recovery. 
The study reviews theoretical approaches to fiscal policy, emphasizing differing views on taxation and public expenditure. Defined as an integrated system of budgetary and tax instruments, fiscal policy enables the state to influence economic activity and structural transformation. The research aims to determine fiscal policy's role in sustainable economic growth and identify directions for improving its components, using theoretical generalization, structural analysis, and institutional approaches. 
The core analysis focuses on public expenditure structures, the balance between current and capital spending, and prioritizing productive expenditures that stimulate investment, human capital formation, and technological modernization. Furthermore, analyzing tax revenues confirms taxation's dominant role in forming the budgetary base, highlighting the need for a balanced tax system combining fiscal sufficiency with investment attractiveness. 
Results demonstrate that fiscal policy effectiveness depends on instrument coherence, fiscal rule stability, budget planning quality, and tax administration efficiency. Ultimately, the findings emphasize the necessity of transforming fiscal policy from short-term budget balancing into a strategic tool for sustainable, long-term economic growth.