Government Budget - It is an annual financial statement of estimated receipts and expenditure of the government for coming financial year.
Objectives of a Government Budget -
(i) Reallocation of resources - The Government has to reallocate resources from less priority areas to more priority areas, to achieve its social and economic objectives.
(ii) Reduction of inequalities - Through the budget government can adopt progressive taxation policy and spend more on requirement of the poor to reduce the inequalities of income and wealth.
(iii) Economic growth- To promote rapid and balanced economic growth so as to improve living standard of the people.
(iv) Economic stability- The Government tries to prevent business fluctuations and maintain economic stability to maintain price stability and correct business cycles.
(v) Reduction of poverty and unemployment- To eradicate (reduce) mass poverty and unemployment by creating employment opportunities and providing maximum social benefits to the poor.
(vi) Management of public enterprises - Government undertakes commercial activities that are of the nature of natural Monopolies, heavy manufacturing etc., through its public enterprises.
