Tax cuts refer to a reduction in taxes for individuals or businesses. This can be done through various methods, such as reducing the amount of income subject to taxation, increasing deductions and exemptions, or lowering tax rates across the board. The goal is generally to put more money into the hands of consumers and businesses so they can spend and invest it in the economy, thereby stimulating growth. Tax cuts are often proposed as a way to boost economic activity during times of recession or slow growth. However, critics argue that tax cuts may not necessarily lead to increased economic activity if people simply save their extra money instead of spending it.