Which policy involves changes to government taxation?

Fiscal policy involves changes to government taxation and spending in order to influence economic activity. It is primarily concerned with how the government budgets its income and expenditures, which directly affects the overall economy. When the government adjusts tax rates or modifies spending programs, it aims to impact factors like inflation, unemployment, and overall economic growth. For instance, increasing taxes can help reduce inflation, while cutting taxes can stimulate consumer spending and economic growth.

Monetary policy, on the other hand, relates to the management of the money supply and interest rates, typically associated with a central bank's actions rather than direct taxation. Trade policy involves regulations and agreements that govern international trade and are unrelated to domestic taxation changes. Social policy focuses on issues like welfare, education, and public health rather than economic instruments like taxation. Thus, fiscal policy is specifically tied to government taxation strategies, making it the correct choice.