Eggertson (2002) provides a theoretical analysis showing that, if government bonds are not indexed to inflation and certain other conditions apply, a money-financed tax cut will in fact raise spending and inflation.
In brief, the reason is that people know that inflation erodes the real value of the government’s debt and, therefore, that it is in the interest of the government to create some inflation. Hence they will believe the government’s promise not to “take back” in future taxes the money distributed by means of the tax cut. BIS Review 68/2002  7  government debt.