BUDGETS, Foreign, National.— Most of the main features of the European budgets are similar. Each department of the government submits a detailed statement showing the object and amount of expenditures for the preceding year and an itemized estimate of expenditures for the next year. These estimates are co ordinated by the ministry of finance, which assumes an especially effective control in Great Britain. The ministry, assisted by the revenue collecting bureaus, estimates the yield of exist ing sources of revenue and if the estimated expenditures exceed the revenues a way must be found either to reduce the expenditures or to provide means of increasing the revenues. In Austria-Hungary, Belgium, France, Holland, Russia and Switzerland the budget goes into effect on 1 January; in Denmark, Germany, Great Britain, Norway, Prussia and Sweden on 1 April; in Italy, Portugal and Spain on 1 July. Great Britain and the countries that follow her practice leave a comparatively short interval between the preparation and enforce ment of the budget, but France allows from 13 to 15 months. The British budget accounts only for actual receipts and expenditures within the fiscal year, and is divided into the per manent °Consolidated Fund* (which includes about one-sixth of the expenditures and four fifths of the revenues, but does not require the annual vote), and the "Supply Services' which are adjusted annually. In Belgium and France there must be yearly votes on revenues and expenditures, while Germany has yearly budgets that contain complete estimates, but the Parlia ment has little more than new proposals to adjust. In most continental states the budgets are divided into ordinary budgets, which in clude the items of annual recurrence, and extraordinary budgets that take in unusual ex penditures to be met by loans or other unusual revenues.
In Great Britain the Crown has the sole right to initiate expenditures. The House of Commons may reduce but it cannot increase the estimates, while the Lords have not even the power to amend — they must either accept or reject the whole budget. No items of ex traneous nature may be attached to the budget (see GREAT BRrrAIN, PARLIAMENT). Many of the European constitutions require that finance bills originate only in the lower house, but most continental legislative bodies have less direct influence on the budget than the British. In the British Parliament the budget is dis cussed in committee of the whole House, deci sions being formally adopted later by the House. Here committee action is representa tive, responsible and decisive, while the reverse is true of continental committees. In Great
Britain a small deficit or unexpected expendi ture is met by a ((supplementary estimate° in the budget, while in the case of an emergency, such as war, expenditures are authorized by a °vote of credit.° In continental states such emergency requirements are met by additional credits or supplementary budgets. Sometimes the passage of the budget is so delayed that the fiscal year is well under way before depart mental funds are available, in which case it is usual to provide for current expenses by pro visional grants. In Great Britain there are numerous checks on the use of funds. Money can be expended only in the amount and for the object specified, and while it is very unusual to transfer balances between °votes?' such transfer is permissible within the same depart ment for army and navy. There is a special auditing department, as also in France, directly responsible to Parliament, that controls the dis bursements and audits all accounts, thus assur ing an accurate execution of the budget.
City Budgets.— In considering German municipal budgets it should be remembered that the empire comprises 26 more or less independent each having its own legis lative body, administrative officials, political subdivisions and system of local government. The financial relations between the local and general governments are verycomplicated, since every taxpayer contributes either directly or indirectly to several governmental organiza tions: (1) The empire, (2) the state, (3) the province, (4) the government district, (5) the circle and (6) the commune, of which there are two kinds— rural and urban. The income tax is a source of both state and municipal revenue, while the unearned increment tax, in troduced into Frankfort in 1904, was adopted by the imperial government in 1911. Under the law this tax should be collected and ad ministered by the various states and the pro ceeds divided between the imperial, state and municipal treasuries, but in practice the tax is collected by the municipal governments which, with the state's sanction, may levy a supple mental unearned increment tax not to exceed 100 per cent of the imperial tax. Hence the policy of one state may not be the policy of all. While the finance administration of both the empire and the state is carried on by a division of the respective ministries of finance, the cities have no special municipal budget com mission or board of estimate, every phase of budget-making being in the hands of the regu larly constituted city officials.