Fiscal Functions Definition

A fiscal function is a government function that involves the spending or raising of revenue. Fiscal functions can be divided into two broad categories: spending functions and revenue functions.

Spending functions involve the expenditure of funds by the government in order to provide goods and services to the public. Common examples of spending functions include education, healthcare, and infrastructure. Revenue functions involve the collection of taxes and other revenues by the government in order to finance its spending.

The distinction between spending and revenue functions is not always clear-cut, as some government programs may have both spending and revenue components. For example, social security programs may involve both the payment of benefits to retirees and the collection of payroll taxes from workers.