Фискальная политика

Annotation

 

     The aim of the course work to explore the nature of fiscal policy, to find ways to improve the tax policy of Kazakhstan. Explore the nature, types, purpose of fiscal policy, to analyze fiscal policy in Kazakhstan. Also, consider the characteristics and trends of fiscal policy in the transformation economy.    

Coursework presented on 36 pages of computer text, includes 6 figures, 2 applications, a list of references consists of 15 titles.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Content

1. Concept, types and objectives of fiscal policy………………………….8

1.1 The concept of fiscal policy……………………………………………8

1.2 Discretionary fiscal policy……………………………………………..9

1.3 Automatic Fiscal Policy………………………………………………...13

 

2. Tax policy is one of the tools of fiscal policy in Kazakhstan ………….15

2.1 Tax policy. Strategy and Tactics of the tax policy…………………….15

2.2 The tax system in the Republic of Kazakhstan………………………...18

 

3. Improving fiscal policy………………………………………………….23

3.1 Improvement of the principles of budget planning and

Intergovernmental relations in the Republic of Kazakhstan……………...23

3.2 Features and Fiscal Policy Trends in Economic Transformation……..25

 

Conclusion………………………………………………………………….30

References………………………………………………………………….32

Application…………………………………………………………………33

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

    Introduction

 

 

      The budget plays an important role in the life of each state. He is the source of income and expenditure, with an impact on the well-being of everyone.  

    As you know, the budget at all levels play a huge role in the development and prosperity of the state, to promote scientific and technological progress (budget funding for research and development), economic development (especially not profitable, but socially important sectors of the economy through investment, subsidies, etc. etc.).     

The completeness of the budget is usually directly proportional to the well-being of citizens. Indeed, the budget deficit, public debt encourages States to increase the tax burden, increase taxes, reduce funding for all sectors of the economy, reduce paper consumption on health care, education, etc. On the other hand plenty of budget funds (budget surplus) increases funding for both public and private sectors, to increase transfer payments, as well as contributions to the budget social funds.     

Just plenty of budget funds allows the state to take an active part in the life of the country. Availability of budget funds allows the State to state regulation of the economy, not only in mandative form. A sufficient amount of budget funds allows the state to use economic levers of direct regulation.     

Thus, the budget, its formation and expenditure is an important chapter in the economic science that requires a lot of attention not only from senior positions economists and politicians, but ordinary citizens.     

The trajectory of the economy depends on the aspirations and will of its main actors: the state, enterprises and citizens. Each of them is able to influence the economic destiny, albeit to varying degrees, at different scales.     

Has the most extensive capabilities in this sense, in the face of state government: the broad sense of the word, that is, all branches of government.     

 The Government has a definite line of action for the implementation of selected socio-economic strategy emanating from targets and takes into account the current situation and emerging trends. In this sense, we say that the state exercises, conducts economic policy drafted by him.     

 In many ways, the economic policy of the state is due to situational, in the sense that it is directly dictated by the inherited past, the current economic situation in the country, previous decisions and commitments. Much of the policy is predetermined in-country and global market conditions - the state of the economy and the market, the level of economic activity, growth and decline trends, supply and demand for goods and services.    

   Economic policy is conducted through the use of state at its disposal tools that aggregate leverage on economic processes and agents of economic activity. It is being implemented through the laws, presidential decrees, executive orders and other regulations, government programs, current operational decisions and the decisions of state authorities.     

Certain tools of the government's economic policy is above all such fiscal leverage, fiscal policy instruments such as taxes,

government spending, transfers. With fiscal tools the state can change the magnitude and direction of the cash flows in accordance with the objectives pursued and planned for implementation measures.    

  Along with the significant role played by fiscal monetary policy instruments, such as the total mass and the availability of money, credit, lending rate (discount rate of the central bank, the reserve ratio, the other centrally imposed standards).     

Governments can use these levers of economic policy is to set a limit (maximum, minimum) price levels for certain types of goods, value of production and received business income, and the income of different social groups, bans and restrictions on certain types of economic activity.      

A widely used instrument of state policy in the field of foreign trade and foreign economic relations are export-import tariffs, customs duties, quotas on imports and exports of goods and capital.      

Depending on the state influence on economic processes and methods, tools of the government's economic policy distinguish its various species.      

Single, standard classification of economic policy does not exist, different authors have different names, and some of its species are

different form the common parts guide economic policy.     

In terms of the enlarged decided to allocate fiscal (fiscal policy), monetary (monetary), foreign economic policy.  

     In broad terms, the state's economic policy include such parts of it as a social, structural, investment, privatization, regional, agricultural, scientific, technical, fiscal, banking, pricing, competition, environmental (ecological), foreign economic policy.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

     1. Concept, types and objectives of fiscal policy

 

      1.1 The concept of fiscal policy

 

    Fiscal (fiscal) policy - a system of regulation of the economy through changes in government spending and taxes. Taxes and government spending are the main instruments of fiscal policy. Fiscal policy can be as beneficial, and quite painful impact on the stability of the national economy.

Fiscal policy, also known as the financial and fiscal, shall cover the main elements of the public treasury (treasury). It is directly related to the state budget, taxes, government incomes and expenditures. In a market economy is a pivotal part of the government's economic policy. Fiscal policy integrates the major types, forms of financial policy as fiscal, tax, income policy and spending.

In general, fiscal policy is evident in the different state arrangements for the management of financial resources of the state, they are used to address social and economic problems. Fiscal policy applies to the mobilization, mobilization of necessary state funds, their distribution, enforcement of these funds for other purposes.

     One of the most important tasks of fiscal policy is to find the sources and methods of formation of the centralized state of funds, the means to attain the objectives of economic policy. Through fiscal policy, the state regulates the global economic processes in the country and supports the stability of finance, monetary, provides funding for the public sector, promotes better use of production-economic and scientific-technical potential. Fiscal policy instruments used by the state to make an impact on aggregate demand and aggregate supply, thus affecting the overall economic environment, contribute to the stabilization of the economic situation, to conduct counter-cyclical measures to counteract the excessive fluctuations of economic parameters, threatening appearance of the crisis.

The share of public sector spending on goods and services is very high, the government acts on the market as the largest buyer expenditure during the year amounts involved in the economically developed countries, about half of the gross domestic product. Purchases made by the State within the country and in foreign markets. Thus, the state has an enormous potential impact on the volume and structure of aggregate demand, if it does not involve himself on his hands and feet due to severe restrictions in advance.

In addition, the state has an indirect impact on demand from private households and enterprises, restraining or stimulating it through taxes and transfer payments such as pensions, scholarships, benefits.

Under normal economic development, the government must have a clear strategic and employment programs to use it effectively in a recession, when people are losing their jobs. Employment programs are usually quite flexible. They are very effective in the sense that unlike the public works programs require less and can be used by local authorities for any local market.

Spending on social programs include pension, various assistance programs to the poor, the costs of education, health care, etc. These programs allow to stabilize economic development when shrinking incomes. The main drawback of all these programs is that they are entered in a recession, and they are hard to undo, when the economy is booming.

     Change in tax rates, from this point of view, is a more effective tool in the effort to stabilize the economy. A reduction in income tax rates in a short-term recession can keep revenue reductions, thus preventing the escalation of the crisis, increasing consumer spending. But there's disadvantage. Temporary tax cuts are not always acceptable to the face of recession, because in a democracy, are generally more difficult to raise taxes after overcoming the recession, it is much easier to organize the political mood to fight unemployment than to fight inflation gap and the over-time. [5, 12p]

     Conscious manipulation of taxes and expenditures or active fiscal policy

PASSIVE fiscal policy, in which the changes in the levels of government spending and taxes are entered automatically

Process of accelerated development of the economy coupled with the creation of an enabling environment for the operation of businesses and organizations. To some extent this is due to the improvement of the tax regime.

Transition from a policy of survival strategies to sustained high rates of economic growth requires improving regulatory process of redistribution of income received between the state, the public and businesses. The urgency of this problem lies in the fact that the basis of economic growth of the industry engaged in the extraction and primary processing of raw materials. The products of these industries for more than 70% of industrial production and exports.

Objectives of Fiscal Policy:

§ smoothing fluctuations of the economic cycle;

§ Achieving a high level of employment and moderate inflation;

§ The stabilization of economic growth;

Types of fiscal policy;

1. Discretionary;

2. Automatic.

 

     1.2 Discretionary fiscal policy

 

One of the main tools of macroeconomic management is fiscal policy. Under the fiscal policy is a set of actions taken by government agencies on changing government spending and taxation. Its main objectives are: smoothing fluctuations of the economic cycle, sustainable economic growth, a high level of employment, lower inflation

Fiscal policy, depending on the mechanisms of its regulation to changes in the economic situation is divided into discretionary and automatic fiscal policy (automatic stabilizers).

Under discretionary policy is a conscious manipulation of government spending and government taxes. It is called an active fiscal policy. It can be performed using both direct and indirect instruments. The former include the change of government purchases of goods and services, transfer payments. The second group - the changes in taxation (tax rates, tax exemptions, tax base), a policy of accelerated depreciation.

Consider the mechanism of discretionary fiscal policy, using the Keynesian model "income - expenses" and assuming that: 1) public expenditure does not affect the consumption or investment, 2) net exports is zero, and 3) the price level is constant, 4) initially economy no taxes, and 5) fiscal policy affects the total costs (aggregate demand), but not to the total supply.

Given these assumptions, we analyze the impact of changes in government spending on national production volume (issue), and income.

Suppose that, initially, the total cost included with consumer spending and investment I, and the economy is in equilibrium at point E1:

 

total costs

 

                                           С+I+G

                                            Е2 20 млрд. руб.

                                                   C+I

                       E1

                   Q1         Q2

                                                                 Revenue issue

Figure 1. Procurement and equilibrium national product.

 

In connection with the decline in production, the government has decided to support the demand, increasing the total cost of public procurement by G. It carried out the procurement of goods and services amounting to 20 billion rubles. These public expenditures are autonomous, ie constant for any output. Therefore, they will lead to an increase in aggregate spending too at 20 billion rubles, which led to a shift from direct + I up to the value of G, at position C + I + G. Planned expenditures will exceed the equilibrium output of Q1. In response, the company will expand production. This process will continue until such time until it is the equality between the total cost and volume of output. The new equilibrium is reached at point E2 at release Q2. An increase in government purchases stimulated the production from Q1 to Q2. The vertical distance between the lines C + I and C + I + G shows the value of public procurement, and the distance between Q2 and Q1 - increase in output. It can be seen that the increase in the number of times the volume of public procurement, ie the latter have a multiplier effect. Government multiplier Mg shows the change in output, income, due to changes in government spending. It can be calculated by the formula:

 

 

Мg =           Change in real national product (income)       

                       Change in government spending.

             

Government multiplier is equal to the investment multiplier, as they have identical effects on the economy. Indeed, the growth of public procurement (and investment) creates additional demand for goods and services, which is the primary income increment equal to the growth of government spending. Part of this income, determined the marginal propensity to consume will be used for consumption, leading to a further increase in aggregate demand and national income, etc. Hence, the change of government spending drives the same process of animation of the national income as a change in private investment. Therefore the government multiplier can also be defined by the formula: [4, 10p]

                                Мg = 1 / (1 - MPC).

 

To determine the change in the real national product (income), the resulting increase in public procurement, it is necessary to multiply the multiplier Mg to increase public spending dG.

In periods of economic expansion, when private costs are large enough, the government reduces the procurement of goods and services. Reducing government spending accompanied by a shift of the curve of total expenditure C + I + G and leads down to the animated reduction of the national product, income.

As well as changes in government procurement, the volume of output, income, transfer payments are the changes that are part of government spending. However, the effectiveness of their impact on demand, and hence, on the national product is slightly less. This is due to the fact that transfer payments to the population leads to an increase in its revenues, but only some of them, the marginal propensity to consume MPC, the population is used for consumption, increasing by the same amount overall cost. The mechanism of effect of changes in transfer payments to production, income is similar to that effect when the taxes.

That public expenditures have a stimulating effect, they should not be funded by tax revenues. Increase in tax rates would reduce the incentives for business activity, leading to a decline in output, income. Therefore, the growth of public spending, usually accompanied by a budget deficit.

Thereby increasing the cost of production during the recession and reducing them during the economic boom, the government mitigates the economic crisis, is seeking a smooth growth of national output.

Instrument of discretionary fiscal policy is changes in taxation. Consider the impact on national product introduction lump (lump-sum) tax. This tax is strictly specified amount, the value of which remains constant when the output.

Assume that the total expenditure C1 + I + G equilibrium is attained at E1 in total output Q1.

 

 

 

 

 

 

 

 

 

 

 

 

Figure 2. Lump sum taxes and equilibrium national product

 

State imposes a lump-sum tax on the population is equal to 16 billion rubles. People use their income on consumption and saving, the relationship between changes to the marginal propensity to consume MPC. We take it to be 3/4. Given the MPC a tax of 16 billion rubles, will reduce consumption by 12 billion rubles, which will reduce the total cost of the same amount. Direct C1 + I + G will move down to the position C2 + I + G. Reducing spending and demand will be accompanied by reduced production until there will come a new equilibrium at E2 when total output Q2. As can be seen from the figure, the distance between Q1 and Q2 is greater than the difference between the vertical line C1 + I + G and C2 + I + G, ie more than 12 billion rubles, which indicates the presence of tax multiplier. It is smaller than the multiplier of government spending. This is explained by the fact that the change of government procurement to one currency leads to the same change in the total cost and the change in the lump-sum tax on currency accompanied by changes in the total cost of MPC * 1. Therefore the tax multiplier is equal to: [7]

 

Mn = MPC * Mg or Mn = MPC / (1 - MPC).

 

By the same formula, we can calculate the multiplier transfer payments. However, if the increase in taxes leads to a reduction in the national product, income, increase transfer payments, on the contrary, contribute to their increase.

In practice, the lump sum taxes are rare. As a general rule, with an increase in output, income taxes rise. Consider, as a proportional tax rate changes affect the overall cost and national product.

Assume that the tax rate is zero, the economic system will be in equilibrium - a point E1. The equilibrium output of Q1.

 

 

total costs

                                                   C+I+G

                                     E1

                                                     C’+I+G