1688 Imperial Constancian Government Budget

The 1688 Imperial Constancian Government Budget involves the process resulting to the enactment of legislation comprising the revenues and expenditure of the Imperial Constancian Government for fiscal year 1688.

This is unique and historical since this was the first time that the Imperial Synklētos was invited to participate in the budget process.

History

While Article 64 of the Magna Carta, promulgated in 1677, mandated that, "The expenditure and revenue of the State require the consent of the Synkletos by means of an annual Budget," and Article 65 required that, "The Budget shall be first laid before the Synkletos," this was not truly followed until the 7th Imperial Synkletos in 1687, where preparations were made to implement this for the first time for the upcoming fiscal year.

In practice, machinations under Article 68, "In order to meet special requirements, the Government may ask the consent of the Basileus to a certain amount as a Continuing Expenditure Fund, for a previously fixed number of years," as well as Article 71, "When the Synkletos has not voted on the Budget, or when the Budget has not been brought into actual existence, the Government shall carry out the Budget of the preceding year," were utilized since the promulgation of the Magna Carta in order to ensure that the National Government was adequately funded for the immediately succeeding fiscal year. The result of this was that the national accounts were not subject to the popular scrutiny as originally envisaged by the Magna Carta.

The 1687 Budget Cycle

Preparation of the Budget

The Committee on Finance of the 7th Imperial Synkletos, under the chairmanship of Imperial Senator Dietmar Schönbeck, figuratively hit the ground running, reviewing the records of previous Committees of Finance, as well as conducting biweekly meetings with Nicolaos Tassotis, Minister for Budget and Management and Panagiotis Karalilis, Minister of Finance. Their combined lobbying effort resulted in the promulgation of a Decree Rationalizing the General Administration of Tariffs, Prescribing a General Sales Tax, Stamp Tax, and an Inheritance Tax, with effect on the first day of 1688, raising additional needed revenues with the expansion of expenditures of the Imperial State.

Prior to the promulgation of this Decree, revenue for the Imperial Government was derived from the Customs and Tariffs Decree of 4.VII.1677, levying a mere one thousand Natopos for every ton of cargo imported (18.12 million tons for 1687, resulting in 18.12 billion Natopos as revenue for 1687, although only 17.28648 billion Natopos was actually collected), and a mere two hundred Natopos for every ton of foodstuffs; as well as a franchise tax of 5% of gross annual earnings of:

• Euran Secure Baggage Logistics Corporation: (3.59305 billion Natopos)
  
• Euran Secure Biosafety Remediation Corporation (0.091350 billion Natopos)
  
• Expeditionary Services Brigade Corporation (0.07500 billion Natopos)
  
• Cario Entertainment Corporation (0.6055 billion Natopos)
  
• Zjandarian Railway & Development Corporation (0.017600 billion Natopos)
  
• Constancian Commercial Exchange Corporation (0.31000 billion Natopos)
  
• Aqaba-Nivardom Railway Construction & Development Corporation (0.16500 billion Natopos)

With only a mere 23 billion Natopos in revenue for 1687 (22.9775) foreign and domestic borrowing was resorted to in order to cover the revenue shortfall, although the equivalent of 25 billion Natopos (or 1.250 billion in Imperial Staters) was generated via seigniorage. Revenues from Androphagos Corporation for 1687 included 1.3 billion Natopos of Raspur opium trade, with an additional 3 billion Natopos on Androphagi trade, but this revenue could not be released to the Imperial Government Treasury due to administrative issues. Crown Land revenues reached 1.929 billion Natopos, but this, too, could not be released to the Imperial Government Treasury without leave of the Basileus.

Credit Rating

Since the destruction of Vey and the restructuring of the Imperial State of Constancia to the Aqaba National Redoubt, great strides were made to improve the economic and financial standing of the Imperial State. Whereas immediately after the Euran War, it was wholly dependent on the grace, charity, and mercy of the Bovic Empire of the Natopian Nation (which would explain close official government relations with the Free Juice and Bagels Party during those times), the relocation of the ESB Group to Aqaba, as well as the opening of new markets, resulted in greater appetite for the Imperial Stater as a reserve currency and as a repository of value, as well as greater enthusiasm into funding Imperial Government debt via treasury bonds, notes, and bills. The absence of an income tax, and there being negligible corporate taxes also made The Imperial State of Constancia, especially the Aqaba metropolitan area, a very favorable location to domicile a business. This, in return, resulted in the rapid growth of the Aqaba metropolitan area, as well as a significant increase in private sector employment.

Expenditure

As expected, there was a significant uproar when the 7th Imperial Synkletos members learned that they had a great role to play in the enactment of the 1688 budget. Rumors and speculation abound regarding the plotting and machinations involved in securing crucial votes, at the committee and plenary level, and the scurrilous libels of great illicit offshore fortunes being made practically overnight remain to be confirmed. The truth of promised employment and consultancy contracts with the ESB Group and its numerous affiliates, or with the Imperial Government could not likewise be ascertained.

Initial submission: The Imperial State Expenditure Program

The Imperial State Expenditure Program is the initial document submitted by the Imperial Government to the Imperial Synkletos, providing a complete listing of all the Imperial Government programs for the succeeding fiscal year. Budget items were expressed in both Imperial Staters and Natopos, with a conversion rate of 50 Imperial Staters to 1 Natopo.

Ministry of Education

The Ministry of Education received the highest proposed allocation, at 13.09540 billion Natopos, or 645.77000 billion Imperial Staters. Of this amount, 10.42700 billion Natopos, or 521.35000 billion Imperial Staters, were allocated for the Bureau of Education Services, for the construction, maintenance, and operating expenses of the Foundation Schools [1], the Ministry of Education having previously noted that existing legislation, while noting that provincial districts may, under existing legislation, enforce a poll tax of 4% of net worth upon adult subjects over fifteen years of age in their jurisdiction, for the purpose of paying for the establishment and maintenance of Foundation Schools, the sums raised were insufficient for the infrastructure, equipment, and operating expenses of Foundation Schools. After consultation with Dikastis of the Imperial Synkletos that these were tangible projects that they could show their respective constituents, support was given by a majority, who had (according to reports) suddenly expressed interest in the pecuniary, enterprising prospects of helping supply that need.

1.47440 billion Natopos, or 73.72000 billion Imperial Staters, were allocated to the construction, maintenance, and operating expenses of universities and colleges of the Imperial State. While Euran University was privately funded, Nivardom Medical College was not, and would fall under this category. Mention was also made of Synkletos Bill No. 52, A Bill Establishing a College in the Zylenisi Dependency, introduced by Imperial Senator Timūr al-Osman Taraghay, and other similar measures that would potentially be enacted by the end of 1687, and would require funding.

1.194 billion Natopos, or 59.70000 billion Imperial Staters were allocated to the Ministry of Education proper, for maintenance and operating expenses.

Ministry of Reconstruction and Infrastructure

The Ministry of Reconstruction and Infrastructure received the second-highest allocation from the Imperial State Expenditure Program, receiving 11.11400 billion Natopos, or 555.70000 billion Imperial Staters. This fund allocation is destined for social housing construction, as well as construction and maintenance of highways, roads, and bridges.

Ministry of Defense

The Ministry of Defense received 186.220 billion Imperial Staters, of which 91.41000 billion Imperial Staters would go to the Imperial Army.

State Protection Authority

The State Protection Authority received 173.24000 billion Imperial Staters

Ministry of Health

The Ministry of Health was allocated 98.57000 bilion Imperial Staters

Ministry of the Interior and Local Government

The Ministry of the Interior and Local Government was allocated a mere 55.47000 billion Imperial Staters.