State and municipal finances. The essence of finance (the most important)

Lecture notes, cheat sheets
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State and municipal finances. The essence of finance (the most important)

Lecture notes, cheat sheets

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1. The essence of finance

Finance - this is a system of monetary relations generated and regulated by the state, associated with the redistribution of the value of the gross domestic product, as well as part of the national wealth.

With the advent of the state came the financial system. Already under the slave system, the state performed a number of socio-economic functions (such as the maintenance of the army, the protection of public order, the construction of buildings, roads, etc.) and replenished its treasury through taxes in cash and in kind. The merger of the monetary form of tax and the functions of the state itself gave rise to the essence of public finance.

State and Municipal Finance there is a set of redistributive monetary relations regulated by the state for the formation and use of monetary income necessary for its implementation of important strategic tasks.

Centralized monetary incomes (funds) include budgets of all levels (state, regional, local), as well as extra-budgetary funds (Federal and territorial compulsory medical insurance funds, Pension Fund, Social Insurance Fund).

It is generally accepted that state and municipal finances perform four functions:

1) planning - achieving maximum balance and proportionality of financial resources;

2) organization - the need to determine the procedure for compiling, approving, and executing the budget, choosing authorized credit institutions, delimiting the powers of executive and legislative authorities in the budget process;

3) stimulation;

4) control - the need to exercise control in the preparation, approval, execution of the budget.

Finance and the financial system were formed at the time of the connection of the state and taxes. Tax taxes ceased to exist in kind and for some time now were collected only in monetary terms.

Author: Novikova M.V.

>> Forward: The history of the emergence of state and municipal finance

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