Government_Budget_and_Economy_Presentation.pptx

It's government budget and the economy

1. Government Budget and the Economy Understanding the Role of Fiscal Policy Rohit, Awaghar Public School

2. Introduction What is a Government Budget? - A government budget is an annual statement showing estimated receipts and expenditures. - Importance in economic management.

3. Components of a Budget 1. Revenue Budget: - Tax Revenue - Non-tax Revenue 2. Capital Budget: - Capital Receipts - Capital Expenditure

4. Objectives of a Government Budget - Redistribution of income and wealth - Allocation of resources - Economic stability - Managing public enterprises

5. Types of Budgets - Balanced Budget: Revenues = Expenditures - Surplus Budget: Revenues > Expenditures - Deficit Budget: Revenues < Expenditures

6. Fiscal Policy - Definition: The use of government spending and taxation to influence the economy. - Types of Fiscal Policies: * Expansionary Fiscal Policy * Contractionary Fiscal Policy

7. Government Receipts - Revenue Receipts: * Tax Revenue: Income Tax, Corporate Tax, GST, etc. * Non-tax Revenue: Fees, Interest, Dividends - Capital Receipts: * Borrowings, Disinvestment, Recoveries of Loans

8. Government Expenditure - Revenue Expenditure: Day-to-day expenses like salaries, subsidies, interest payments. - Capital Expenditure: Long-term investments such as infrastructure and development projects.

9. Budget Deficit What is a Budget Deficit? - Revenue Deficit - Fiscal Deficit - Primary Deficit

10. Impact of Budget on the Economy - Stimulates growth in case of expansionary policies. - Controls inflation through contractionary measures. - Redistributes wealth through subsidies, welfare schemes, progressive taxation.

11. Conclusion - Summary: The government budget plays a vital role in influencing economic growth, stability, and the distribution of wealth. - Key Takeaways: Importance of fiscal policy, budget deficits, and government expenditure in shaping the economy.