Government budget

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Fiscal policy Tax policy · Budgetary policy Revenue · Spending · Budget Deficit or Surplus · Deficit spending Debt (External · Internal) Finance ministry · Fiscal union
Monetary policy Money supply · Interest rate Monetary base · Discount window Reserve requirements Bank reserves · Gold reserves Monetary authority (Central bank · Currency board) · Monetary union
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Revenue and Spending Tax revenue · Non-tax revenue Mandatory spending Discretionary spending
Optimum Balanced budget (Fiscal) Price stability (Monetary) Growth (Trade and Investment)
Reform Fiscal adjustment · Monetary reform
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Budgeted revenues of governments in 2006

A government budget is a legal document that is often passed by the legislature, and approved by the chief executive-or president. For example, only certain types of revenue may be imposed and collected. Property tax is frequently the basis for municipal and county revenues, while sales tax and/or income tax are the basis for state revenues, and income tax and corporate tax are the basis for national revenues.

The two basic elements of any budget are the revenues and expenses. In the case of the government, revenues are derived primarily from taxes. Government expenses include spending on current goods and services, which economists call government consumption; government investment expenditures such as infrastructure investment or research expenditure; and transfer payments like unemployment or retirement benefits.

Budgets have an economic, political and technical basis. Unlike a pure economic budget, they are not entirely designed to allocate scarce resources for the best economic use. They also have a political basis wherein different interests push and pull in an attempt to obtain benefits and avoid burdens. The technical element is the forecast of the likely levels of revenues and expenses.

National Budget - this is when a country finds out what the government's expected income and expenditure will be for that year.

References

• Performance Budgeting: Linking Funding and Results, Marc Robinson (ed.), IMF, 2007
• From Line-item to Program Budgeting, John Kim, Seoul, 2007
• List of countries by budget; its reference is the CIA's World factbook, in alphabetic order.
• Micha Grau. 2008. Using a Model Municipal Performance Measurement System to Assess Mid-size Texas Cities' Systems.