CSEET · Economic and Business Environment · Indian Union Budget
Which of the following is classified as a non-tax revenue receipt of the Central Government in the Union Budget?
Interest received on loans given to State Governments is a non-tax revenue receipt. It is income earned by the government without creating a liability or reducing an asset. Corporation tax is tax revenue, while loan recoveries and disinvestment proceeds are capital receipts.
- ACorporation tax collected from companies
- BInterest received on loans given to State GovernmentsCorrect
- CProceeds from recovery of loans given earlier
- DProceeds from disinvestment of shares in a public sector undertaking
Explanation
Interest receipts on loans advanced to States are earned income that does not create a liability or reduce an asset, so they are non-tax revenue receipts. Corporation tax is a tax revenue receipt. Recovery of loans and disinvestment proceeds reduce assets and are capital receipts.
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