PUBLIC REVENUE AND EXPENDITURE IN KENYA
Is the revenue and expenditure of the national and county government.
Principles of public finance
Is a comprehensive statement that gives an estimate of public revenue, expenditure and financial plans for a given financial year for government.
Both the national and the county governments have to prepare a budget each financial year specifying their revenue sources and expenditures.
The national and the county government budgets contains the following;
Estimates of revenues and expenditure
Details on how deficit gaps are to be financed
Proposals that affect the borrowing and public liability during the next financial year
National registration shall declare rules for the following
Structure of development plans and budget of counties
when the plans and budget of counties shall be tabled in the county assemblies
consultation between county and national governments in the preparation of budgets
The cabinet secretary for finance is expected to submit to the national assembly the estimates of government revenue and expenditure for the next financial year, two months before the end of the each financial year.
The budget is read in June because Kenya fiscal year begins on 1st July and ends on 30th June of the following year.
The budget day is set by the minister for finance after consulting with all the necessary government organs and the president
Reasons for the preparing of a national budget in Kenya
Sources of government revenue in Kenya
Domestic revenue sources
Group of taxes
1. BILATERAL AID
This is where two friendly nations assist each other e.g. Kenya and Japan
2. Multilateral aid
This involves many countries that have formed trading blocs or a global institution to help poor nations includes; the IMF world bank, European Union, common wealth etc
The money collected by the national government to be used to provide based services to marginalized areas in order to bring the quality of these services to the level enjoyed by the test of the country
All money raised or received by or on behalf of the national government
Revenue funds, for each county government
All money raised or received by or on behalf of the county government
To cater for urgent end foreseen emergencies and expenditure
Challenges facing government effort in raising revenue
Many individuals, companies and organization evade paying taxes
In wealth declaration people and companies give wrong information reducing the amount due for taxation
Government officers who gather tax information collude with unscrupulous citizens to cheat about their income
Many rich individuals have the tendency of keeping their money in foreign accounts instead of cheating inventing in Kenya
People generating lack of information on how they can invest with the government through treasury bills, post office bonds and shares
Ways How the government spends revenue
This is the money set aside in the national budget for development projects
The government allocates money for infrastructural development such as roads, bridges, government buildings, railways, seaports and harbours
It also indentifies essentials facilities to be established such as schools colleges universities, dams, irrigation schemes etc
The government provides social services like health and education so that citizen gets value for taxes paid
Management of public finance