CSEET · Economic and Business Environment · Indian Union Budget
In the Indian Union Budget, the revenue deficit is defined as the excess of:
Revenue deficit is the excess of revenue expenditure over revenue receipts. It shows that the government's current earnings from taxes and non-tax sources are insufficient to meet its day-to-day spending, so borrowing is used to finance even consumption-type expenditure.
- ATotal expenditure over total receipts excluding borrowings
- BRevenue expenditure over revenue receiptsCorrect
- CCapital expenditure over capital receipts
- DRevenue receipts over revenue expenditure
Explanation
Revenue deficit arises when revenue expenditure exceeds revenue receipts. The option about total expenditure over receipts excluding borrowings describes the fiscal deficit, not the revenue deficit. Capital items are not part of the revenue deficit.
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