Abstract:
The study assessed the impact of fiscal policy dynamics on economic growth concerning the
Tanzanian economy 2000-2020. The study was guided by three predicting variables tested on
economic growth as the dependent variable. The predicting variables include recurrent
expenditure, development expenditure, and income tax. The explanatory design was used to
depict the knowledge gap for the inquiry employing causal relationship testing between study
variables. Secondary data were used whereas specifically using panel data in time series for
the period of 21 years (2000-2020). The data were gathered from secondary sources, which
were filled in an Excel sheet and imported into the E-view 10 software for generating
statistical measurements to present the results. Findings indicated that among three
predicting variables, two namely recurrent expenditure and development expenditure, have
been found significant on economic growth (p<0.05). However, income tax was found
significant towards economic growth with (p>0.1) 10% level of significance. This implies
that economic growth through fiscal policy dynamics is influenced by recurrent expenditure
and development expenditure, and income tax.
