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As we know budget is a system that related to money and finance. Generally budget is about a guideline or financial planning for a unit, country, and also for people. There are many definition of budget and one of it made by Ekstein that stated budget as ‘ detailed statement of income and expenditure that have been made or expected to be made’. In Malaysia every year people will focus on the National Budget that present in the Parliament of Malaysia by the Prime Minister, like recently in the 2011 Budget where it explained the government’s finance including revenues and expenditures. Malaysia is expected to be a developed country in the Year 2020, so it is important for Malaysia to have budget that effective and relevant in order to achieve the goal. The importance of having effective budget in Malaysia are as follows. Firstly of the importance of budgeting is it acts as a blue print and financial plan of the Ministry of Finance. So with the budget of country, the Ministry of Finance will have a clear view on how to managing country financial. So if the budget relevant and effective thus it will make Ministry of Finance to build a comprehensive blue print or financial plan so they can plan well that will lead them to work well and contribute well in developing country. Example of 2012 that presented recently will be as a guideline to make realize a better performance for Ministry of Finance in managing financial of country Secondly an effective budget in Malaysia also will ensure government to able run it’s activity smoothly. If the budget is effective thus government able to do it’s activity effectively . Example in 2012 Budget where the Prime Minister said that government will provide RM 15 Million in order to build over 150 futsal courts all over the country under ‘1 Gelanggang 1 Mukim’ programme. So here show that government manage to handle it’s budget well and after that manage to run many activities that bring benefit to peoples. It also ensure government will not overspending allocation for projects or it’s activites. This also will able government to make the spending parallel to the revenue. Thirdly is as a tool in develop economy of country. Economy is one of responsibilities of government where many government action and policy that determine economy of country. Example of government action in economy we can see through recently 2012 Budget where FELDA will be listed on Bursa Malaysia by mid-2012 to raise funds for the company to become a global conglomerate. Lastly is to run the democracy cycle. As we know the government is selected by the winning party in election and in democracy principe it is stated that the politician that sits in government actually work for benefit of people so it is their responsibilities to provide the best in the annual budget so people will satisfy with the government and to ensure to remain the seats in government. Example of 2012 Budget where it is last budget before next 13th General Election and we can see that Barisan Nasional government really try to satisfy people by give money to school student, the expansion of Kedai Rakyat 1 Malaysia and the Bantuan Rakyat 1 Malaysia that will be give to family with income RM 3000 below.