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Economic Definition of subsidy. Offline Version: PDF. Term subsidy Definition: A payment from government to individuals or businesses without any expectations of production. The best way of thinking about a subsidy is as a negative tax.
What is a subsidy? A health care subsidy is financial assistance from the government that you could be eligible for to help you pay for health insurance. Your eligibility is generally determined by your household income and family size. To see if youâre eligible for a subsidy, check out this health care calculator.