What would be the macroeconomic effect of an increase in government spending financed entirely by an increase in taxes?

The answer to this question depends on the assumptions
that you are making.

To a Keynesian, the impact of this
action would be to increase GDP without increasing the price level.  This analysis
depends on the idea that the aggregate supply curve is flat, which allows aggregate
demand to rise without causing inflation.

A more
conservative economist, however, would not agree with this analysis.  They would argue,
for example, that the impact of the increase in taxes would be to depress the economy. 
They would argue that a great increase in taxes would erode the confidence of consumers
and business people.  This would reduce both aggregate demand (because consumers would
lose confidence) and aggregate supply (because businesses would not invest as much). 
This would lead to a decrease in GDP and (depending on the magniude of the declines in
AS and AD) potentially to an increase in price levels.