1.

Distinguish between revenue receipts and capital receipts in a government budget. Give examples.

Answer»

Distinction between revenue receipts and capital receipts :

Basis of distinctionRevenue receiptsCapital receipts
(i) NatureRevenue receipts are the receipts of recurring nature.Capital receipts are the receipts of
(ii) ContentsRevenue receipts include tax and nontax receipts .Capital receipts include non-tax receip
(iii) PurposeIts purpose is to meet regular expenses.Its purpose is to create liability or to reduce financial assets.
(iv) ExamplesIts examples are income tax, licence fee etc.Its examples are loan from public and foreign debt.


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