National Budget Flashcards
What is the National Budget?
The national budget sets out how much money a government has made and how much money it has spent in a year. It’s the government’s estimate of its income and expenditures. Its what the Government plans to spend for programmes and projects and where the money will come from.
What is the National Treasury?
The National Treasury manages the South Africa’s national governments finances.
Who is the Minister of Finance?
Tito Mboweni
What does Tito Mboweni do?
He decides how to spend the money the SouthAfrican government raises in taxes, debt and charges.
What are taxes?
The amounts of money people pay to the government for public goods and services.
What are charges?
The prices of goods and services.
What is debt?
The cost of borrowing money.
What is revenue?
The money that the government collects is called revenue.
Name 2 types of taxes.
- Indirect tax
2. Direct tax
What is indirect tax?
Indirect taxes are taxes that people pay indirectly without even knowing through businesses and municipalities.
Name 7 types of indirect tax.
- VAT
- Sin tax
- Customs duty
- Import tax
- Municipal tax
- Fuel tax
- Transport tax
What is direct tax?
Taxes paid directly to the government for the goods and services the government provides.
Name 2 types of direct tax.
- Income tax (Pay As You Earn)
2. Business tax: Paid on the profits of the business.
Name 3 ways that the government can earn money besides tax.
- Property that it rents out
- Interests on investments
- Borrowing money, when there are fewer taxpayers
because the economy is not growing and people are losing jobs.
Why does the government want to encourage jobs and economic growth?
The government raises most of its money from taxing the workforce, therefore the government wants to encourage jobs and economic growth to get more money.
Name 3 ways the government encourages jobs and economic growth.
- Public transport to get workers to work cheaply and quickly
- Job creation projects that need unskilled workers
- Education
What are social grants?
Social grants are amounts of money the government gives to poor people and old people.
Name 4 ways that the government is trying to correct its mistakes in 1994.
- Social grants
- Free education for the poor
- Free primary healthcare for the poor
- Free water and electricity for the poor
What are wants?
Things we don’t really need but would
like to have it.
Each person will have different wants
which will change with time.
Wants are limited/unlimited.
Unlimited.
Name 3 wants.
Sports car, cellphone, holidays.
What are needs?
Things we must have in order to stay
alive.
Needs are items which people cannot live
without.
Name 4 needs.
Water, shelter, clothing, food
What are services?
Its something done for someone else.
Sometimes people are paid for their
service, sometimes they are not.
Name 3 services.
Hair salon, Police, Firefighters
What are goods?
Something you can see and feel.
It is something you can use.
Name 4 goods.
Car, books, bicycle and clothes
What is fiscal policy?
Fiscal policy is the means by which a government adjusts its spending levels and tax rates to monitor and influence a nation’s economy. It is the sister strategy to monetary policy through which a central bank influences a nation’s money supply.
What is monetary policy?
Monetary policy is the process by which the monetary authority of a country, typically the central bank or currency board, controls either the cost of very short-term borrowing or the monetary base, often targeting an inflation rate or interest rate to ensure price stability and general trust in the currency.
What is income in a Government?
Income that is received by the Government from taxes
What are expenses in a Government?
Money that is spend by the Government on certain things the country needs
Name 8 types of income.
Personal income tax Corprorate income tax Value added tax (VAT) Fuel levies Excise duties Customs duties Other taxes Loans
What is sin tax?
Tax paid on cigarettes, alcohol and sugar to discourage people from buying these items
Sin taxes are used to increase the price in an effort to lower the consumption
To increase and find new sources of revenue
Increasing a sin tax is often more popular than increasing other taxes.
However, these taxes have often been criticized for burdening the poor
Name 9 areas of expenditure.
Education Welfare Health Housing Transport and communication Protection services (police, defence) Water and agriculture National Debt Other
Name 6 social grants.
Grant for older persons Disability grant War Veteran's grant Foster Child grant Care Dependency grant Child Support grant Grant-in-Aid
