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Questions
Distinguish between revenue receipts and capital receipts in a government budget. Give example in each case.
Distinguish between revenue receipts and capital receipts of the government, with suitable examples.
Solution
| S. No. | Basis of Difference | Capital Receipts | Revenue Receipts |
| 1. | Meaning | These refer to those government receipts that cause a reduction in government assets and also create liability for the government. | These refer to those government receipts that neither create any liability nor they create any reduction in the government assets. |
| 2. | Reduction in Assets | They cause a reduction in the assets of the government. | They do not cause any reduction in the assets of the government. |
| 3. | Creation of Liability | They create liability for the government. | They do not create any liability for the government. |
| 4. | Example | Recovery of loans is a capital receipt. | Tax receipts are revenue receipts. |
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2019-2020 वास्तविक Actuals |
||
| 1. | Revenue Receipts | 1684059 |
| 2. Tax Revenue (Net Tax Revenue) | 1356902 | |
| 3. Non-Tax Revenue | 327157 | |
| 4. | Capital Receipts | 1002271 |
| 5. Recovery of Loans | 18316 | |
| 6. Others Receipts | 50304 | |
| 7. Borrowings and Other Liabilities | 933651 | |
| 8. | Total Receipts (1 + 4) | 2686330 |
| 9. | Total Expenditure (10 + 13) | 2686330 |
| 10. On Revenue Account | 2350604 | |
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Statement 1 - Revenue and Capital receipts are increasing but borrowings and other liabilities are reducing.
Statement 2 - Grants and aid for the creation of capital assets decreased from 2019 to 2021.
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"In the Annual Budget 2022-23, the Government of India set up disinvestment targets of ₹ 65,000 crore".
Such proceeds from disinvestment can be classified as ______ receipts in the Government Budget as it leads to ______ of the Government.
