Government Budget Process & Planning Nick Cates Zander Peter Mitchell Gornto

What is a Budget? A budget is an estimate of income and expenditure for a set period of time. A budget is important because it can cause a nation to flourish or go into debt. In order to thrive in the economy, the budget must be balanced. The government is responsible for managing the nation’s income and expenditures.

Revenue Revenue is the income of a government from taxation, excise duties, customs, or other sources, appropriated to the payment of the public expenses. Revenue is important because without it, the country would become broke. Revenue must be greater than or equal to the expenditures in order to maintain a balanced budget.

Expenditures Expenditures are funds that are being spent. If the expenditures are too great, a country will go into debt. The U.S. spends money on things like research, assistance programs, and the military. All of these things are important in maintaining a strong country. The U.S. is currently in debt because our expenditures are greater than our revenue.

Appropriations Bill A legislative act proposing to authorize the expenditure of public funds for a specified purpose. This is what allows the government to spend public funds on certain things.

Mandatory Spending Spending that is automatically obligated due to previously-enacted laws. This spending is basically required by law. An example of mandatory spending would be entitlement programs such as Medicare and Social Security.

Discretionary Spending US government expenditures that are set on a yearly basis. This type of spending can be changed from year to year. It is all at the discretion of the government. An example of discretionary spending would be education because the budget can change.

Entitlement Programs Entitlement programs are setup to help the American public. They include things like Social Security, Medicare, and Medicaid. Citizen tax dollars are used to pay for these programs. Entitlement programs are in place to help citizens who need some assistance.

Deficit Deficit is the act of spending more money than you are bringing in. The deficit can cause a country to have a high national debt. The government would prefer to have a low deficit because it makes it easier to control the national debt.

National Debt The national debt is the total amount of money that a country's government has borrowed, by various means. This is the result of a high deficit. The U.S. national debt is currently about $12,240,620,500,999. This is inaccurate because it increases by the second.

Surplus A surplus is the opposite of debt. This happens when the revenue is higher than deficit.

Taxes

Progressive Tax With a progressive tax, the tax rate increases as the taxable base amount increases. Income tax is an example of progressive tax. Higher income families have to pay a higher tax rate than families who are in a lower economic class.

Regressive Tax This is where the tax rate decreases as the amount subject to taxation increases. Cigarettes are an example of an item that carries a regressive tax. Regressive taxes tend to hurt lower income families more severely.

Proportional Tax This is when everybody is paying the same tax rate. Each person may be paying different dollar amounts but it is the same tax rate for everybody. Sales taxes can be considered proportional because everybody will be paying the same rate.

Video 2jU 2jU

Current Event blog/wp/2013/04/05/americas-taxes-are-the- most-progressive-in-the-world-its- government-is-among-the-least/ blog/wp/2013/04/05/americas-taxes-are-the- most-progressive-in-the-world-its- government-is-among-the-least/

Works Cited government-budgets-compliance-best-practices/ government-budgets-compliance-best-practices/