Финансы как экономическая категория - важнейшая part of the world economic system. In fact, they represent an instrument through which the redistribution of GDP is carried out, and the creation and operation of various monetary funds is controlled. Many people unite the concepts of finance and money, but such a decision is fundamentally wrong. Finance as an economic category is a narrower concept, since, unlike monetary relations, they reflect only those cash flows that go through special funds, and do not take into account the interaction of ordinary people. Thus, the essence of finance and their functions have their own characteristics in comparison with money. Let us dwell in more detail on this question.
Finance as an economic category has several main functions:
- Distributive - with its help occursfinancing of all business entities with necessary funds. The most graphic in this case is the example of the state budget, into which taxes of citizens of a certain country are initially collected. After the budget is replenished from all possible sources of financing, the distribution of funds among various organizations, ministries and other economic structures begins. It is this function of finance that allows all citizens of the state to receive their share of the gross domestic product, and for the state to fulfill their obligations to the population.
- Monitoring function allows you to receiveinformation about the production process in general and its various components. This function allows you to quickly receive information and make decisions about changing the situation.
- Fiscal - is in the state withdrawal from citizens and enterprises
portions of their income in order to containstate apparatus and exercise its functions. It is through paying taxes that the country's budget is formed, which is then distributed to defense, education, medicine, science and culture, as well as other components of our life.
- Incentive function istax rates are different for different categories of citizens and enterprises. In addition, it implies the availability of benefits and penalties that help not only collect taxes on time, but also contribute to the development of certain sectors of the economy. An example of this function is the state program aimed at the development of small business. Many entrepreneurs can now work under the simplified taxation system, as well as receive government subsidies and subsidies.
As you can see, the role of finance in the economy is enormous.
