1) Revenue Receipts: Revenue receipts are receipts of the government which are
non-redeemable, that is, they cannot be reclaimed from the government. They
are divided into tax and non-tax revenues. Table 5.1 provides the receipts and
expenditure of the Central Government for the financial year 2012-13.
Tax revenues consist of the proceeds of taxes and other duties levied by the
central government. Tax revenues, an important component of revenue receipts,
comprise of direct taxes – which fall directly on individuals (personal
income tax) and firms (corporation tax), and indirect taxes like excise taxes (duties
levied on goods produced within the country), customs duties (taxes imposed
on goods imported into and exported out of India) and service tax1. Other direct
taxes like wealth tax, gift tax and estate duty (now abolished) have never been of
much significance in terms of revenue yield and have thus been referred to as
‘paper taxes’. Corporation tax contributed the largest share in revenues in
2012-13 (34.4 per cent) while personal income tax contributed the second largest
(190 per cent). The share of direct taxes in gross tax revenue has increased from
19.1 per cent in 1990-91 to 53.4 per cent in 2012-13.
2) Capital Receipts: All those receipts of the government which create liability or
reduce financial assets are termed as capital receipts. The main items of capital
receipts are loans raised by the government from the public which are called
market borrowings, borrowing by the government from the Reserve Bank and
commercial banks and other financial institutions through the sale of treasury
bills, loans received from foreign governments and international organisations,
and recoveries of loans granted by the central government. Other items include
small savings (Post-Office Savings Accounts, National Savings Certificates, etc),
provident funds and net receipts obtained from the sale of shares in Public Sector
Undertakings (PSUs) (This is referred to as PSU disinvestment).
3) Capital Expenditure: There are expenditures of the government which result
in creation of physical or financial assets or reduction in financial liabilities
This includes expenditure on the acquisition of land, building, machinery
equipment, investment in shares, and loans and advances by the central
government to state and union territory governments, PSUs and other parties
Capital expenditure is also categorised as plan and non-plan in the budget
documents. Plan capital expenditure, like its revenue counterpart, relates to
central plan and central assistance for state and union territory plans. Non
plan capital expenditure covers various general, social and economic services
provided by the government.
For more updates stay tuned.
non-redeemable, that is, they cannot be reclaimed from the government. They
are divided into tax and non-tax revenues. Table 5.1 provides the receipts and
expenditure of the Central Government for the financial year 2012-13.
Tax revenues consist of the proceeds of taxes and other duties levied by the
central government. Tax revenues, an important component of revenue receipts,
comprise of direct taxes – which fall directly on individuals (personal
income tax) and firms (corporation tax), and indirect taxes like excise taxes (duties
levied on goods produced within the country), customs duties (taxes imposed
on goods imported into and exported out of India) and service tax1. Other direct
taxes like wealth tax, gift tax and estate duty (now abolished) have never been of
much significance in terms of revenue yield and have thus been referred to as
‘paper taxes’. Corporation tax contributed the largest share in revenues in
2012-13 (34.4 per cent) while personal income tax contributed the second largest
(190 per cent). The share of direct taxes in gross tax revenue has increased from
19.1 per cent in 1990-91 to 53.4 per cent in 2012-13.
2) Capital Receipts: All those receipts of the government which create liability or
reduce financial assets are termed as capital receipts. The main items of capital
receipts are loans raised by the government from the public which are called
market borrowings, borrowing by the government from the Reserve Bank and
commercial banks and other financial institutions through the sale of treasury
bills, loans received from foreign governments and international organisations,
and recoveries of loans granted by the central government. Other items include
small savings (Post-Office Savings Accounts, National Savings Certificates, etc),
provident funds and net receipts obtained from the sale of shares in Public Sector
Undertakings (PSUs) (This is referred to as PSU disinvestment).
3) Capital Expenditure: There are expenditures of the government which result
in creation of physical or financial assets or reduction in financial liabilities
This includes expenditure on the acquisition of land, building, machinery
equipment, investment in shares, and loans and advances by the central
government to state and union territory governments, PSUs and other parties
Capital expenditure is also categorised as plan and non-plan in the budget
documents. Plan capital expenditure, like its revenue counterpart, relates to
central plan and central assistance for state and union territory plans. Non
plan capital expenditure covers various general, social and economic services
provided by the government.
For more updates stay tuned.
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