REVENUE FORECASTS

Revenue Forecasts, Revenue Estimates, and Tax Expenditure Budgets



Revenue Forecasts, Revenue Estimates, and Tax Expenditure Budgets,

Introduction

Equity and efficiency are crucial concepts in economics, so it is useful to begin by defining these terms. Two principles guide evaluations of the effect economic policies have on equity. The benefit principle is the viewpoint that it is equitable for citizens who benefit from government services to pay for them. The ability-to-pay principle is the viewpoint that it is equitable for a citizen's tax liabilities to be correlated with the citizen's economic resources. It follows that taxpayers with equal abilities to pay should be taxed equally (horizontal equity) and that tax liability should increase as ability to pay increases (vertical equity). Resources are allocated efficiently if and only if they are used where they have the highest social value.

But what is the value added of a government budget? Government budgets have two major purposes. First, budgets provide information the public needs to evaluate the costs and benefits of public goods and services. This information is fundamental in democracies. Underlying the relations between a democratic government and its citizens is an assumption that government activities are sanctioned by a social contract in which citizens relinquish some freedom in return for public goods and services. Without a budget, this evaluation would be more difficult than it is.

Expense

State and local governments separate operating from capital expenditures, and report a separate capital budget. For example, spending on public capital infrastructure (government buildings, highways and bridges, etc.) is included in state capital budgets, whereas spending on teacher and administrative salaries is included in operating budgets. Many foreign national governments publish capital, as well as operating, budgets. Capital budgeting requires time and resources.

1998

1999

2000

2001

January

668,534.00

625,149.10

559,070.90

714,981.00

February

782,026.60

754,396.90

874,000.00

575,115.00

March

738,856.70

811,506.70

988,047.20

583,592.00

April

826,622.90

880,075.80

916,030.70

586,743.00

May

678,031.10

756,507.90

800,876.80

June

736,974.50

831,054.50

940,975.10

July

824,343.70

978,485.60

967,098.40

August

668,708.80

743,718.40

841,267.50

September

766,271.30

898,210.00

874,308.10

October

759,679.80

846,494.20

887,091.40

November

742,371.50

847,950.20

936,090.70

December

984,911.20

1,259,467.10

1,204,961.70

9,177,332.10

10,233,016.40

10,789,818.50

2,460,431.00

From the analysis, it is clear that budget has increased over the years. Typically, unemployment ranges from 2% to 5% of an employer's total payroll. Workers' compensation is usually 2% to 5% of base salary. Employers pay into a state, private, or self-insurance fund. This fund covers medical benefits, lost wages, and death benefits when there is an on-the-job mishap (Wing, 2008).

Revenue

Projecting revenue at Republic for Vardar, is straightforward. The executive director anticipates several grants will be renewed. This includes government support restricted to the shelter and to job readiness programs. Shelter, Inc., like many non-profits, receives grants that are restricted to a particular program or special project. With the exception of unrestricted contributions from individuals and a ...