The surplus of the state budget is an indicator showing the excess of budget revenues over expenditures. In other words, achieving a positive balance in the country based on the results of economic activity of business entities. A deficit-free budget is the most favorable option for the state budget. However, the actual balance of this indicator is not often achieved. And as a result, the state has a budget deficit, which subsequently leads to tax debt.
As is known from theory, the budget structure is represented by a combination of state, regional, municipal and consolidated budgets. And this division must be taken into account when conducting a detailed analysis of the results of their implementation. Thus, the budget deficit at the state level does not cover the negative balance of most regional and local budgets.
The state budget surplus should be constantly examined from the perspective of positive and negative assumptions. So, if this indicator arises as a result of efficient and economical consumption of budgetary funds and at the same time there is complete 100% financing, then this phenomenon is, of course, a positive one. In the event that sufficiently high revenues were generated as a result of the favorable economic situation, or were obtained due to austerity, inadequate financing for public spending - this cannot be considered a positive moment.
Based on the surplus received, a stabilization fund is created at the state level, with revenues amounting to approximately half of the state budget revenues. The state can use these funds to attract investment in the country, modernize (upgrade) fixed assets, strengthen innovation activity, and finance health and social services.
The surplus of the state budget forms precisely those additional savings that the state can use to acquire additional financial and non-financial assets, pay off debt and pay capital transfers.
The state budget surplus is in constant confrontation with the deficit. These two indicators are opposite and cannot exist simultaneously. Thus, the budget deficit is an indicator of the excess of government spending over income. At the same time, income and expenses are formed according to a special classification specified in the relevant law on the state budget.
The main reason for the deficit is the decline in production, political instability in the country and, of course, war. All these factors show a significant decrease in budget revenues in the form of lower tax revenues. And at the same time, expenses either remain at the same level or even increase. Thus, a gradual increase in the deficit can be seen.
Sources of covering the budget deficit can be represented in the form of additional financing, as well as attracting various types of investments. The first method can be represented by monetary emission, which can increase inflationary processes, be characterized by rising prices for services and goods, reduce the living standards of most of the population and exacerbate social tension in the country. Namely, based on these reasons, the most acceptable option for the state is the use of internal and external loans.
Summing up all of the above, we can conclude that the state budget surplus can have both positive and negative aspects in its formation. These factors should be subjected to detailed analysis by state financiers and prevent the emergence of negative aspects in the formation of the state budget in the future.
