Under an expansionary taxation policy, the government tries to stimulate economic growth by

reducing deficits.

reducing taxes.

reducing demand.

reducing spending.

reducing taxes

Explanation:

Tax is a compulsory levy, imposed by the government of a country on individuals and businesses. The aim of imposing tax is to raise revenue by the government and finance provisions of basic infrastructures like housing, education, electricity. etc

When government intends to stimulate economic growth, she does so by creating an expansionary taxation policies. It means that government would cut or reduce taxes thereby making money that should have been paid as tax available to individuals, household and firms.

Government cutting tax will stimulate investment in the country and production of goods and services by businesses and also increase economic activities of consumers due to the availability of money.