Types of business organisationsPublic sector

Money to pay for these is raised through a variety of taxes and fees.

Taxes are money that people and businesses pay to the government so that it can pay for services that help everyone, like schools, hospitals, roads, and the police. eg:

• Income Tax
• National Inurance
• Value Added Tax (VAT)
• air passenger duty
• fuel duty

Once this tax is collected it is allocated to various government budgets.

Fees charged include parking permits, entry fees (eg to leisure facilities), charges for pasport applications.

There are three different levels of government in Scotland:

• UK Government
• Scottish Government
• local government

UK Government

The UK Government is based in Westminster. Matters which are run by the UK Government rather than by the Scottish Government are called “reserved” matters. These include:

• economic policy
• defence
• international relations

The UK Government also oversees the running of organisations which we call public corporations. These organisations are founded by an Act of Parliament and are usually funded by taxpayers.

The BBC is an example of a public corporation. It was founded by the 1922 Broadcasting Act, and is funded by the TV licence fee. It is not directly run by the UK government.

Scottish Government

The Scottish Government is based in Holyrood. It is responsible for “devolved” matters. These include:

• health
• education
• police
• transport

The Scottish Government has some limited income tax raising powers and receives a block grant from the UK Government. The Scottish Government sets the budget for running Scotland.

Scottish local government

Scottish local government is made up of 32 local authorities – often referred to as councils. They are allocated budgets by the Scottish Government as well as generating revenue from their local population via council tax and charging fees. THey use these funds to run many local services. These include:

• housing
• libraries
• schools
• bin collection and recycling