Discretionary vs. automatic fiscal policies:

Discretionary - increase or decreasing government spending and or taxes in order to return the economy to full employment . Discretionary policy involves policy makers doing fiscal policy in response to an economic problem.
Automatic - unemployment compensations and marginal tax rates are examples of automatic policies that help mitigate the effects of recession and inflation. Automatic fiscal policy takes place without policy makers having to respond to current economy problems.

Contractionary vs. expansionary fiscal policy

Contractionary - policy designed to decrease aggregate demand (strategy for controlling inflation)

 *decrease government spending and increase taxes

Expansionary - policy designed to increase aggregate demand (strategy for increasing GDP, combating a recession and reducing unemployment.
*increase government spending and tax decreasing

Automatic or built in stabilizers:
*Anything that increase the government budget deficit during a recession and increases and increases its budget surplus during inflation without requiring explicit action by policymakers

*No discretionary fiscal policy automatic stabilizers
*Transfer payments : welfare checks, food stamp, unemployment checks, corporate dividends , social security, veterans benefits

*Progressive tax system : average tax rate (tax revenue/GDP rises with GDP

*Proportional tax system - average tax rate remains constant as GDP changes

*Regressive tax systems - average tax rate falls with GDP