Government revenue or national revenue is money received by a

government A government is the system or group of people governing an organized community, generally a state. In the case of its broad associative definition, government normally consists of legislature, executive, and judiciary. Government i ...

from taxes and non-tax sources to enable it to undertake

public expenditure Public expenditure is spending made by the government of a country on collective needs and wants, such as pension, provisions, security, infrastructure, etc. Until the 19th century, public expenditure was limited as laissez faire philosophie ...

. Government revenue as well as

government spending Government spending or expenditure includes all government consumption, investment, and transfer payments. In national income accounting, the acquisition by governments of goods and services for current use, to directly satisfy the individual ...

are components of the

government budget A government budget is a document prepared by the government and/or other political entity presenting its anticipated government revenues, tax revenues (Inheritance tax, income tax, corporation tax, import taxes) and proposed government expenditu ...

and important tools of the government's

fiscal policy In economics and political science, fiscal policy is the use of government revenue collection ( taxes or tax cuts) and expenditure to influence a country's economy. The use of government revenue expenditures to influence macroeconomic variabl ...

. The collection of revenue is the most basic task of a government, as revenue is necessary for the operation of government, provision of the

common good In philosophy, economics, and political science, the common good (also commonwealth, general welfare, or public benefit) is either what is shared and beneficial for all or most members of a given community, or alternatively, what is achieved by c ...

(through the

social contract In moral and political philosophy, the social contract is a theory or model that originated during the Age of Enlightenment and usually, although not always, concerns the legitimacy of the authority of the state over the individual. Social ...

in order to fulfill the

public interest The public interest is "the welfare or well-being of the general public" and society. Overview Economist Lok Sang Ho in his ''Public Policy and the Public Interest'' argues that the public interest must be assessed impartially and, therefor ...

) and enforcement of its

laws Law is a set of rules that are created and are enforceable by social or governmental institutions to regulate behavior,Robertson, ''Crimes against humanity'', 90. with its precise definition a matter of longstanding debate. It has been vari ...

; this necessity of

revenue In accounting, revenue is the total amount of income generated by the sale of goods and services related to the primary operations of the business. Commercial revenue may also be referred to as sales or as turnover. Some companies receive rev ...

was a major factor in the development of the modern bureaucratic state. Government revenue is distinct from government debt and

money creation Money creation, or money issuance, is the process by which the money supply of a country, or of an economic or monetary region,Such as the Eurozone or ECCAS is increased. In most modern economies, money creation is controlled by the central bank ...

, which both serve as temporary measures of increasing a government's money supply without increasing its revenue.

Sources

There are a variety of sources from which government can derive revenue. The most common sources of government revenue have varied in different places and time periods. In modern times, tax revenue is typically the primary source of revenue for a government. Types of taxes recognized by the

OECD The Organisation for Economic Co-operation and Development (OECD; french: Organisation de coopération et de développement économiques, ''OCDE'') is an intergovernmental organisation with 38 member countries, founded in 1961 to stimulate ...

include taxes on income and profits (including income taxes and

capital gains taxes A capital gains tax (CGT) is the tax on profits realized on the sale of a non-inventory asset. The most common capital gains are realized from the sale of stocks, bonds, precious metals, real estate, and property. Not all countries impose ...

social security Welfare, or commonly social welfare, is a type of government support intended to ensure that members of a society can meet basic human needs such as food and shelter. Social security may either be synonymous with welfare, or refer specifical ...

contributions,

payroll taxes Payroll taxes are taxes imposed on employers or employees, and are usually calculated as a percentage of the salaries that employers pay their employees. By law, some payroll taxes are the responsibility of the employee and others fall on the em ...

property taxes A property tax or millage rate is an ad valorem tax on the value of a property.In the OECD classification scheme, tax on property includes "taxes on immovable property or net wealth, taxes on the change of ownership of property through inherit ...

(including wealth taxes, inheritance taxes, and

gift taxes A gift tax or known originally as inheritance tax is a tax imposed on the transfer of ownership of property during the giver's life. The United States Internal Revenue Service says that a gift is "Any transfer to an individual, either directly ...

), and taxes on goods and services (including value-added taxes, sales taxes, excises, and duties). Besides, lotteries can also bring in considerable revenue for the government. In early 2009, the Australian government used lotteries to boost spending, generating more than $60m in additional tax revenue for state governments. Non-tax revenue includes dividends from government-owned corporations,

central bank A central bank, reserve bank, or monetary authority is an institution that manages the currency and monetary policy of a country or monetary union, and oversees their commercial banking system. In contrast to a commercial bank, a centra ...

revenue,

fines Fines may refer to: * Fines, Andalusia, Spanish municipality * Fine (penalty) * Fine, a dated term for a premium on a lease of land, a large sum the tenant pays to commute (lessen) the rent throughout the term *Fines, ore or other products with a s ...

, fees, sale of assets, and capital receipts in the form of external loans and debts from international financial institutions.

Foreign aid In international relations, aid (also known as international aid, overseas aid, foreign aid, economic aid or foreign assistance) is – from the perspective of governments – a voluntary transfer of resources from one country to another. Ai ...

is often a major source of revenue for

developing countries A developing country is a sovereign state with a lesser developed industrial base and a lower Human Development Index (HDI) relative to other countries. However, this definition is not universally agreed upon. There is also no clear agreem ...

, and for some developing countries it's the primary source of revenue.

Seignorage Seigniorage , also spelled seignorage or seigneurage (from the Old French ''seigneuriage'', "right of the lord (''seigneur'') to mint money"), is the difference between the value of money and the cost to produce and distribute it. The term can be ...

is one of the ways a government can increase revenue, by deflating the value of its currency in exchange for surplus revenue, by saving money this way governments can increase the prices of goods. Under a federalist system, sub-national governments may derive some of their revenue from federal grants.

Politics

Most governments have a finance minister that oversees government revenue. Governments may also have a separate revenue service dedicated to the collection of revenue.

References

Citations

Fiscal policy {{finance-stub

Sources

Politics

See also

References

Citations