Public finance in Pakistan How the Government Manage :

In Pakistan, public finance is similar to managing your weekly allotment, but on a far greater scale. It all boils down to how the government spends its money, where it comes from, where it goes, and how it affects the country and its people. Let's get started with simple, easy-to-understand language.

Where Does the Government Get Its Money?

The government obtains its money from a variety of sources, just like you can get your allowance from your parents:

Taxation:

In Pakistan, both individuals and corporations pay taxes to the government. These are similar to the fees we all pay to support the requirements of the government. There are various forms of taxes, such as income tax (money paid on profits) and sales tax.

Import Fees:

When items enter Pakistan from other countries, the government takes money, such as a minor fee, to allow those items to enter Pakistan.

Other Earnings:

The government earns money from a variety of sources. For example, they may charge fees for services such as passport issuance and profit from firms they hold, such as state-owned enterprises.

Where Does the Government's Money Go?

The government spends money on a variety of essential topics, including:

Building and Development:

A large portion of the funds are used to improve Pakistan. They construct schools for educational purposes, hospitals for medical treatment, and roads and infrastructure for transportation purposes.

Security and defense:

Some funds have been set aside to keep Pakistan safe. It is utilized to protect the country by our armed forces.

People Helping People:

The government spends money to better the lives of its citizens. This includes support for healthcare, education, and social welfare services for individuals in need.

Paying Off Debts:

If the government has borrowed money in the past, they must repay not only the money but also a small amount of interest.

Supporting certain Areas:

The government will sometimes offer money to certain industries or organisations to assist them succeed. This is done to stimulate the economy and create jobs.

Running Everyday Tasks:

Just as you need money for daily expenses, the government requires funding to run its daily operations, such as paying salaries to government personnel.

How Does the Government Spend Its Money?

Every year, the government creates a plan, similar to a budget, for how the money will be spent. They select how much money to spend on various items based on what the country most needs.

This plan is debated in parliament, where people's representatives vote on whether it is acceptable. Once agreed upon, the money can be used as planned by the administration.

What Happens When There Is Insufficient Funding?

The government occasionally spends more money than it earns in a year, resulting in a "budget deficit." It's like spending your entire allowance and then some. To offset this, the government may borrow money from others with the promise of repaying it later with some extra money known as "interest."

The Influence of Government Funding:

Inflation: When the government prints too much money to finance its expenditures, it can cause items to become more expensive for people, such as your toys being more expensive.

Economic Growth:

When the government spends its money wisely, it may help the country flourish and improve people's lives.

Keeping an Eye on the Situation:

There are safeguards in place to guarantee that the government spends its money responsibly. Audits and accountability procedures serve to guarantee that money is spent wisely and for the benefit of the country and its residents.

Challenges to Be Aware Of:

People in government may spend funds for improper purposes, such as lining their own pockets (corruption). Furthermore, the government must make difficult decisions since it cannot do everything with the resources it has.

Conclusion :

In a word, public finance in Pakistan is concerned with how the government earns and spends money to improve the lives of its citizens. It's like a huge financial puzzle that impacts the entire country, and properly handling it is critical for Pakistan's well-being and progress.