What are the objectives of government budget?

Asked by Topperlearning User | 19th Apr, 2016, 09:21: AM

Expert Answer:

Objectives of the government budget are

  1. Redistribution of income and wealth: Government through fiscal tools of taxation transfer payment brings fair distribution of income.
  2. Reallocation of resources: Through the budgetary policy, the government can reallocate resources so that social and economic objectives can be met.
  3. Economic growth: Growth rate of a country depends on the rate of savings and investment.
  4. Generation of employment: Government needs to promote labour intensive technology, public work programmes to undertake employment specific projects.
  5. Economic stability: Government tries to maintain price and employment stability. It stimulates inducement and to invest and increase the rate of growth and development.
  6. Management of public enterprises: Public sector enterprises are encouraged in area of natural monopolies.

Answered by  | 19th Apr, 2016, 11:21: AM