00:01
Hello, so we have a question right here that says, as of 2016, up to date, the nambibian government has been experiencing fiscal problems and tax revenues or falling short of planned expenditures.
00:19
What factors can influence state revenue and collections and expenditures explain why state governments must cut spending or increase taxes when revenues fall short of.
00:31
Expenditures so let's go ahead and answer this question so there are several factors that can influence state revenue collections and expenditures including the economic conditions and let me go ahead and explain a little bit about this so the overall health of the economy can affect these tax revenues as the economic growth leads to higher tax avenues so as the economy leads to higher tax avenues so as the tax revenues while recession or slow economy growth can reduce tax revenues okay so the next factor is the demographics all right changes in the population such as aging population can affect expenditures on health care um also if you think about it the social security okay um which can impact the government budgets the next factor is going to be the government policies okay so tax policies and regulations set by the government can affect the revenue collections as well as the government spending priorities um the next factor is going to be external shocks and i'm going to tell you what that is.
02:24
All right.
02:24
So unexpected events, unexpected events such as natural disasters, economic shocks, can have significant impact on state revenue collections and expenditures.
02:40
When revenues fall short of planned expenditures, state governments must either cut spending.
02:48
So they, let me go ahead and write that here.
02:49
They must either cut spending or, including, taxes to balance their budgets...