What is a Money Bill?

A money bill is legislation exclusively devoted either to expenditures, or revenues such as taxes, tariffs or other assessments. In Westminster-type parliamentary systems, which are based on England’s government, money bills may only originate in the lower house of the legislature, often called the House of Commons. In the United States, the Constitution requires only that revenue bills originate in the House of Representatives; spending bills may originate in either the House or the Senate.

In the Westminster-type parliamentary systems, once the lower house has passed a money bill, it’s presented to the upper house, but the actions that house may take are usually limited. For example, amendments may be proposed, but they have the status of suggestions; the lower house will consider them, but isn’t obligated to agree in order to pass the money bill. The upper house must complete its review of a money bill within a certain period of time, which varies by nation, but its assent is not required. Missing the deadline is called “blocking the supply,” and is forbidden. The lower house, then, essentially sends money bills to the upper house only for its review and comments; the upper house has no power to change or veto money bills.

Money bills in parliamentary systems often are the basis for determining the confidence of the legislature in the government’s competence to govern effectively. If the majority party or coalition proposes a money bill that isn’t passed by the lower house, it’s said that the house has lost confidence in the government. This usually triggers the appointment of a replacement for the head of government, often the prime minister, by the head of state; in other cases, a general election is called, which may result in the replacement of the government or its return to power.

Money bills like this, and the protocols surrounding them, don't exist in the American system. The Constitution only requires that all bills dealing with raising revenue — primarily tax bills — originate in the House, but it doesn’t demand exclusivity of content, nor does it restrict what actions can be taken when such bills are presented to the Senate for action. Amendments with no relation to the bill’s original subject are frequently attached to revenue bills by both the House and the Senate. In addition to amending them, when presented with revenue bills passed by the House, the Senate can vote them down or even replace the House’s language entirely. Like all legislation in the American system, though, revenue bills must be agreed to by both houses before they can be presented to the President for signature.