PUBLIC

FINANCE

PRESENTED BY:
D.B THAPA
 Introduction
 Public finance refers to the study of how governments at various levels
( national, regional, or local) manage their resources, raise revenue,
and allocate funds to meet their economic and social objectives.
 It involves the analysis of government expenditures, taxation,
borrowing, and financial policies aimed at achieving economic stability,
public welfare, and overall societal well-being.
 It also studies the impacts of government policies on economy.
 Roles of PF in Nepal
 Resource Mobilization: Public finance helps the government raise resources through
various means, such as taxation, non-tax revenue, grants, and borrowing. These resources
are essential for funding government expenditures and development projects.
 Government Expenditure: Public finance is instrumental in determining how government
funds are allocated and spent. In Nepal, government expenditures cover a wide range of
areas, including infrastructure development, education, healthcare, social welfare programs,
and public administration.
 Economic Development: Public finance policies in Nepal aim to promote economic
development by allocating funds to critical sectors such as transportation, energy, and
education. Infrastructure development is particularly important to boost economic growth
and improve living standards.
 Debt Management: Nepal, like many other countries, may engage in borrowing to
fund development projects and meet budgetary requirements. Public finance is crucial
for managing public debt to ensure it remains sustainable and does not become a
burden on future generations.

 Budgetary Planning: The formulation and execution of the national budget are central
to public finance. The budget reflects the government's priorities, and effective
budgetary planning is essential for achieving economic goals and maintaining fiscal
discipline.

 Social Welfare Programs: The government uses public finance to implement various
social welfare programs, including poverty alleviation initiatives, healthcare services,
and education programs. These efforts contribute to improving the quality of life for the
citizens of Nepal.
Sources of public revenue
The government generates revenue from a variety of sources, which can be broadly
categorized into two main groups:
tax and non-tax revenue.
 Tax Revenue:
 Direct Taxes: These are levied on individuals and businesses based on their
income, wealth, or property. Examples include income tax, corporate tax, capital gains
tax, and property tax.
 Indirect Taxes: These are levied on goods and services and are typically passed on to
consumers in the form of higher prices. Examples include value-added tax (VAT), customs
duties, excise duties, and service taxes.
 Non-Tax Revenue:

 Fees and Charges: The government charges fees for various services it provides, such as
license fees, registration fees, and user charges for public utilities.
 Fines and Penalties: Revenue is generated from fines imposed for violating laws and
regulations.
 Profits from Public Enterprises: The government owns and operates a number of
enterprises, such as airlines, banks, and hydropower companies. Profits from these
enterprises contribute to public revenue.
 Foreign Aid: Nepal receives significant foreign aid from international organizations and
bilateral donors, which contributes to various sectors like
education, healthcare, infrastructure, and poverty reduction.
 Other Sources: These include lottery proceeds, interest income on government
investments, and donations from individuals and organizations.
Thank you so muchhhh