The state budget is an indispensable condition for the work of any state that needs cash resources to fulfill its functions.
For the first time, they tried to formulate a unified estimate of expenses and incomes in England at the end of the 17th century.
At the time of its formation, the state budget was expressed in the estimate of the country's possible income and expenses. This definition met the requirements of the time. Its occurrence was due to the need to create a unified set of disparate calculations related to income and expenses for the most important events of a national nature.
In the process of development of society, the definition used has become obsolete. Thus, the concept of the state budget begins to take on the character of the main financial plan, while determining the movement of the bulk of the country's financial reserves.
The expansion of state functions contributes to an increase in the number of sources of expenditure and income. The state budget, the structure of which is becoming more complicated, is connected with other state plans.
In the Russian Federation, a country's financial plan is drawn up for a year. At the end of this period, the government reports on its implementation.
The state budget is an important link in the process of redistribution of national income, playing a special role in social reproduction. So, through the main financial plan, about 50% of national income is redistributed, which in many countries is about 3/4 of all funds. In turn, this gives the state the opportunity not only to meet the needs of national importance, but also to exert an active influence on the entire social life, thus fulfilling programs on social and economic development in the state.
The provision that is assigned to the state budget gives it legal force. Therefore, the main financial plan is approved by the highest legislative bodies (parliaments). Implementation of the plan is mandatory for all participants in the financial process.
The country's budget is of great economic importance. First of all, it is expressed in the fact that the financial plan through the system of income, direction and volume of financial resources has an impact on socio-economic processes. Among them, it should be noted, in particular, employment, business activity, the market of consumer products and equipment, and others.
The main components of the main financial plan are expenditure and revenue. The sources of finance are reflected in the revenue part, in the expenditure — goals for which the accumulated funds are directed.
Sources of income include taxes, the issue (additional issue) of credit and paper money, government loans (bills, securities and others), as well as loans provided by international organizations.
In developed countries, the structure of the expenditure is determined as follows:
- At least 50% of the budget goes to meet social needs;
- About 20% is aimed at maintaining the defense capability of the state.
The remaining funds are allocated for the development of infrastructure (communications, roads, landscaping, etc.), servicing state debts (debt), and providing subsidies to enterprises.
The state budget, whose functions include distribution (redistribution) and control, allows not only to concentrate finances in the hands of the state, but also to control the timeliness and completeness of their receipts in the country. Thus, the main financial plan is a reflection of the processes occurring within the economic structure.