Question 9

Does the Executive’s Budget Proposal or any supporting budget documentation present the individual sources of tax revenue (such as income tax or VAT) for the budget year?
 * a. Yes, individual sources of tax revenue accounting for all tax revenue are presented.
 * b. Yes, individual sources of tax revenue accounting for at least two-thirds of, but not all, tax revenues are presented.
 * c. Yes, individual sources of tax revenue accounting for less than two-thirds of all tax revenues are presented.
 * d. No, individual sources of tax revenue are not presented.
 * e. Not applicable/other (please comment).

Note on revenues
Revenues generally are separated into two major categories: “tax” and “non-tax” revenues. Taxes are compulsory transfers that result from government exercising its sovereign power. The largest sources of tax revenue in some countries are taxes on personal and business income and taxes on goods and services, such as sales or value-added taxes. The category of non-tax revenues is more diverse, ranging from grants from international institutions and foreign governments to funds raised through the sale of government-provided goods and services. Note that some forms of revenue, such as contributions to social security funds, can be considered either a tax or non-tax revenue depending on the nature of the approach to these contributions. Particularly because different revenues have different characteristics, including who bears the burden of paying the tax and how collections are affected by economic conditions, it is helpful when estimates for revenues are disaggregated and displayed based on their sources.

For more information, please refer to the 2001 GFS manual, in particular Appendix 4.

Guidelines
Question 9 assesses the degree to which the individual sources of “tax” revenue are disaggregated in the budget. The largest sources of tax revenue in some countries are taxes on personal and business income and taxes on goods and services, such as sales or value-added taxes.

To answer “a,” the Executive’s Budget Proposal or its supporting documentation must present all individual sources of tax revenue for the budget year, and “other” or “miscellaneous” revenue must account for three percent or less of all tax revenue. To answer “b,” the Executive’s Budget Proposal or its supporting documentation must present individual sources of tax revenue that when combined account for at least two-thirds of all tax revenue, but not all revenue. A “c” answer applies if the Executive’s Budget Proposal or its supporting documentation presents individual sources of tax revenue that account for less than two-thirds of tax revenues. Answer “d” applies if individual sources of tax revenue are not presented.

"Other" categories
Watch out for aggregate categories, such as “other.” To receive an “a” answer, the “other” category has to be smaller than 3% of the total. If the “other” category is more than 3%, then the score should be “b.”