MACROECONOMICS GROUP 3 DECEMBER 2023

FISCAL POLICY
MACROECONOMICS GROUP 3 DECEMBER 2023

Fiscal Policy
Fiscal policy is the use of
government spending and
taxation to influence the
economy.
It can affect the level of
aggregate demand, output,
employment, inflation, and the
balance of payments.

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MACROECONOMICS GROUP 3 DECEMBER 2023

Fiscal Policy
• The Power of the Purse,
meaning that Congress alone
has the power to approve
spending.
• Congress can stop other
branches of Government from
spending money to programs it
doesn’t like.

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MACROECONOMICS GROUP 3 DECEMBER 2023

National Budget

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MACROECONOMICS GROUP 3 DECEMBER 2023

National Budget
(PHASE 1)
Budget Preparation

(PHASE 4) (PHASE 2)

Budget Accountability Budget Legislation

(PHASE 3)
Budget
Implementation page 04
MACROECONOMICS GROUP 3 DECEMBER 2023

BUDGETING
Local governments create budgets that outline
LOCAL BUDGET
their planned expenditures and revenues for a
specific period, typically a fiscal year. These
budgets allocate funds to various departments
and programs, reflecting the government's
priorities and objectives.

EXPENDITURE POLICIES
Local governments use their budgetary
authority to allocate funds to essential
services such as education, public
safety, infrastructure development, and
healthcare. The allocation of resources
reflects the priorities of the local
community and government officials.
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MACROECONOMICS GROUP 3 DECEMBER 2023

DEBT MANAGEMENT
Local governments may incur debt through the issuance of municipal bonds to
LOCAL
finance large projects. Proper debt management is crucial to ensure the long-term
fiscal health of the local government, and it involves balancing the need for
investment with the ability to service the debt.

MONITORING AND EVALUATION

Effective fiscal policy requires continuous monitoring and evaluation
of budgetary outcomes. Local governments need to assess the impact
of their policies on economic and social indicators to make informed
decisions for future fiscal planning.
GRANT PROGRAMS
Local governments may receive grants from higher levels of
government or external sources. These grants can be targeted towards
specific projects or initiatives, providing additional funds to address
particular needs.
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MACROECONOMICS GROUP 3 DECEMBER 2023

Policies or Laws behind Budgeting

Art. VI, Sec. 29 PPFAA NIRC

“No money shall be paid by
the Treasury except in
pursuance of an appropriation
made by law."
The Philippine Public The National Internal
Financial Accountability Act Revenue Code of !997 (NIRC),
(PPFAA), which proposes to which provides the legal
reform the budget process and basis for the taxation system
enhance the transparency and in the Philippines, including
accountability of public the income tax, value added
financial management. tax, excise tax, and other
taxes.

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MACROECONOMICS GROUP 3 DECEMBER 2023

Policies or Laws behind Budgeting

BRB E-VAT LAW
The Budget Reform Bill (BRB), The Expanded Value Added
which aims to Tax Law (E-VAT Law), which
institutionalize fiscal increased the VAT rate from
responsibility principles to 10% to 12% and broadened
guide fiscal policy-making in the coverage of VAT to
the Philippines. Among these include more goods and
principles are services.
macroeconomic stabilization
and inclusive economic
development.

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MACROECONOMICS GROUP 3 DECEMBER 2023

THANK YOU FOR LISTENING!

DANIELLA IRA PATRICE JESSE

Members