Introduction

Fiscal policy affects macroeconomic stability, growth, and income distribution. Citizens expect their governments to ensure value-for-money for public spending, a fair and efficient tax system, and transparent and accountable management of public sector resources.

The IMF has been a leading source of fiscal policy and management expertise worldwide. The IMF monitors and analyzes global fiscal trends and advises IMF member countries on fiscal issues directly. This page highlights the main fiscal policy issues currently under discussion, as well as provides links to research, publications, and commentary.

Additional Spending and Forgone Revenue in Response to the COVID-19 Pandemic

(Percent of G20)

Budgetary fiscal support to people and firms has varied widely across countries.

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Current Fiscal Issues Fiscal Monitor: Policies for the Recovery

Fiscal Monitor: Strengthening the Credibility of Public Finances 

Chapter 1: Policy in an Uncertain Recovery

This chapter argues that fiscal policy should remain nimble and strengthen its medium-term frameworks, as countries face highly uncertain and differentiated prospects. Vaccination has saved lives and is helping fuel a nascent recovery, but risks are elevated amidst new virus variants, high debt, and poverty. In advanced economies, the shift in fiscal support toward medium-term packages to “build back better” will have overall positive effects globally. Emerging markets and low-income developing countries face a more challenging outlook, with permanent economic scarring and revenue losses. They need international support to increase vaccine availability and financing to achieve the Sustainable Development Goals.

Chapter 2: Strengthening the Credibility of Public Finances

Many countries find themselves in a situation where fiscal support is still invaluable to protect lives and livelihoods. At the same time, governments are also facing questions on their elevated debt and gross financing needs. This report provides countries with guidance on how they can both avoid withdrawing fiscal support too early, and yet signal to the public that their debt levels are sustainable in the long run. To commit to future deficit reduction, governments have several instruments, including undertaking structural fiscal reforms (such as pension reform or subsidies reform), pre-legislating changes to taxes or spending, committing to fiscal rules that lead to deficit reduction in the future. 

Special Series on COVID-19

The Special Series notes are produced by IMF experts to help members address the economic effects of COVID-19. The series addresses issues in tax policy, tax administration, public financial management, expenditure policy, and macro-fiscal policies.

Global debt  

Global debt is at all times high.