PAC 111: Introduction to Public Administration (Final Term Reporting)
GROUP 1
Leader:
Cosme, Rhenelyn Jhoy J.
Members:
Abo, Janah Jene G.
Bocobo, Raffy
Oreta, Nigel Troy S.
Topics:
● Meaning of Fiscal Administration
● Government Expenditures
● Revenue Generation
● Tax Revenue
MEANING OF FISCAL ADMINISTRATION
- According to Tendero, fiscal administration is essentially a process that deals with the
financial resources of the government. He defined fiscal administration as “the
composite of those activities and operations to generate revenue, make these
available, and see to it that funds are wisely, lawfully, effectively, and efficiently
spent.”
- Fiscal administration is a complex of several processes that tackles the administration
of government resources which at times are limited and could hardly meet the
demands of the general public.
- According to Briones, fiscal administration “refers generally to the formulation,
implementation, and evaluation of policies and decisions on taxation and revenue
administration; resource allocation, budgeting and public expenditure; public
borrowing and debt management; and accounting and auditing.”
GOVERNMENT EXPENDITURES
- Expenditure is the action of spending funds.
- The expenditure system of a country is always directed to the pursuit of its national
development.
- The expenditure as a concept is considered as the fiscal arm of the government in
the production, allocation, and distribution of social goods and services. It serves as
the control factor on the part of the government as to how national development
objectives could be achieved.
Over the past several years, the thrust of the government expenditures in the
Philippines had shown varying degrees in terms of priorities of the previous administration.
1956 - 1960: Focused more on social development.
1971: Shifted its focus to economic development.
1987 - 1992: Focused on social development, particularly in the agricultural sector.
1992 - 1998: Economic development, many trade policies.
2010 - 2016: Focused on the areas of economic development, social services, general
services, and national defence.
REVENUE GENERATION
Revenues refer to all cash inflows of the national government treasury which are collected to
support government expenditures but do not increase the liability of the national
government. Revenues consist of tax and non-tax collections. Governments collect revenues
mainly for two purposes: to finance the goods and services they provide to citizens and
businesses and to fulfill their redistributive role.
Leonor Briones, a fiscal administration expert, defined the revenues as funds used not only
to keep the government machinery going but also to enable the government to carry out its
various fiscal functions of allocations, distributions, and stabilization. Revenue is critical as it
determines to a large extent how much money will be available for spending. Without
income, there will be no budget, and thus no spending. Revenue for government spending is
generally raised from taxes, levies, service fees, and licenses.
Briones also defined that revenues pertain to all incomes or receipts of the government
treasury to support government expenditures. The national government expenditure is
allocated according to the following major sectors: social services, economic services,
defense, general public services, and debt burden.
The Philippine government generates revenues mainly through personal and income tax
collection, but a small portion of non-tax revenue is also collected through fees and licenses,
privatization proceeds, and income from other government operations and state-owned
enterprises. It also includes capital revenues, extraordinary incomes, public borrowings,
grants, and tax revenues.
Capital Revenues: Capital revenues are a non-recurring incoming cash flow into the business
that leads to the creation of liability and a decrease in company assets.
Extraordinary Incomes: An extraordinary gain is a gain resulting from a business transaction
that is rare and highly unusual. Extraordinary gains are much less frequently reported than
extraordinary losses.
Public Borrowing: the total amount that a government borrows, or the act of borrowing this
money: The Treasury is keen to reduce government borrowing quickly. The government has
been forced to rely on public borrowing to finance a series of stimulative measures.
Grant: A grant is an award, usually financial, given by one entity (typically a company,
foundation, or government) to an individual or a company to facilitate a goal or incentivize
performance. Grants are essentially gifts that do not have to be paid back, under most
conditions.
Tax Revenue: Tax revenue is defined as the revenues collected from taxes on income and
profits, social security contributions, taxes levied on goods and services, payroll taxes, taxes
on the ownership and transfer of property, and other taxes.
TAX REVENUE
Tax revenue
- important source of all government revenues
- The lifeblood of the government and so is the state that relies heavily on the
contribution of its people
According to Hector De Leon (Fundamentals of Taxation)
Major Features/ Characteristics of Taxation
- It is enforced contribution
- It is proportionate in character
- It is levied by the law making body of the state
- it is levied for public purposes
- it is levied on persons and property by the state which has jurisdiction
- it is generally payable in money
-it is levied on persons and property by the state which has jurisdiction
2 categories of tax revenues
- Direct taxes
- Indirect taxes
Main resources of tax revenues
- Income taxes
- Transfer Tax
- Value added tax
- Custom duties
- Real property tax
