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Specific terminology and jargon is often used to mystify and confuse, and this can easily prevent people from working with budgets. Common terms include:

-          Budget: statement of expected income and expenditure over a specified period of time. The public budget is the income and expenditure of a government.

-          Balanced budget: when the income and expenditure are equal.

-          Capital expenditure: expenditure on infrastructure and materials which are invested in and will last beyond the budget period.

-          Deficit budget: when the expenditure is greater than the income (a surplus budget is when income is greater than expenditure).

-          Budget heads: the different items in a budget, for example teachers’ salary, training, infrastructure.

-          Expenditure: the amount of money allocated to specific items (or actually spent) in a budget.

-          Financial year: The twelve months, on which a budget is based, this varies from country to country often 1st April 31st March.

-          Needs-based budget: A budget developed according to the different needs of different members of the population.

-          Recurrent expenditure: regular expenditure, for example on teachers’ salaries, school meals.

-          Redistributive: To distribute expenditure in a budget differently from income this is usually done to achieve greater social justice, i.e. more of the income of the budget might come from the rich, and more expenditure is targeted at the poor.

-          Regressive: The poor pay proportionally more tax than the rich (a progressive tax is when the rich pay more than the poor).

-          Revenue: the income or money coming into a budget, a government budget will have revenue from taxes, services (that it charges for), investments, loans and grants/ aid.

-          Tax: an amount of money charged on a particular item. Direct tax is sometimes called income tax, and is the tax charged on an individual’s (or company’s) income (salary). Indirect tax, or value-added tax is the tax on goods and services, it also includes import and export taxes.