A budget is an estimation of the revenue and expenditure of country over a specific future period (Jan. 1 - Dec. 31).
In addition, a fiscal activity is the spending of revenue such as taxes from the households and businesses on the expansion of social infrastructure including roads and ports and production of public services such as national defense and public order.
The functions of finance can be divided into efficient allocation of resources, income redistribution and economic stabilization. First, resources are efficiently allocated spontaneously in the market economy.
Despite the efficient allocation of resources, there is no guarantee that people’s income would also be distributed in a fair and just manner. Therefore, government redistributes income through finance.
Furthermore, government promotes economic stabilization through monetary and fiscal policies.
※ Source: Fiscal Innovation Town
