National revenue and expenditure
Sources of government revenue
- Taxes – these include Income Tax, Customs Duty and Value Added Tax.
- Trade licenses.
- Loans from World Bank and International Monetary Fund. These have to be repaid with interest.
- Aid and grants from friendly countries. These are some form of gifts and do not need to be paid back.
- Interest on government loans.
- Rent paid by people occupying government houses and offices.
- Court fines.
- Dividends from shares bought by the government in profitable companies.
- Rates paid by people who own property in urban areas.
- Profits made by parastatal organisations.
Forms of government expenditure
The government uses the money it collects to:
- Repay loans.
- Construct roads, schools and hospitals.
- Provide basic services like education, health and security.
- Pay salaries.
Role of government in the society
- The Legislative arm of the government makes laws through parliament.
- Protecting the rights and freedoms of its citizens.
- Collecting revenue.
- Improving the standards of living of the citizens.
- Providing basic services such as health and education.
- Providing security for all its citizens.
- Paying salaries for all government employees.
- Planning the expenditure for the country.
- Preparing and reading the Budget on Budget day, on how the money collected is to be spent.
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