The Union Budget of India is an annual financial statement presented by the government to the parliament, which outlines the estimated revenues and expenditures for the upcoming fiscal year. The receipts of the Union Budget refer to the sources of revenue for the government, which can be broadly categorized into two types: revenue receipts and capital receipts.
- Revenue Receipts: Revenue receipts refer to the income received by the government in the course of its normal activities. These receipts can be further classified into tax revenue and non-tax revenue.
a. Tax Revenue: Tax revenue is the income earned by the government through various taxes levied on individuals and entities. The major sources of tax revenue for the government include income tax, corporate tax, customs duty, excise duty, and goods and services tax (GST).
b. Non-Tax Revenue: Non-tax revenue refers to the income earned by the government through sources other than taxes. This includes revenue from interest and dividends, fees and fines, and profits from public sector enterprises.
- Capital Receipts: Capital receipts refer to the income received by the government through investments, borrowings, and disinvestment. These receipts can be further classified into non-debt capital receipts and debt capital receipts.
a. Non-Debt Capital Receipts: Non-debt capital receipts refer to the income received by the government through the sale of assets, including land, buildings, and shares in public sector enterprises.
b. Debt Capital Receipts: Debt capital receipts refer to the income received by the government through borrowings, including market borrowings, external borrowings, and small savings.
In recent years, the government of India has been focusing on increasing its revenue receipts, particularly tax revenue, to reduce its dependence on borrowings and to boost economic growth. The Union Budget of 2021-22, for example, projected a significant increase in tax revenue through measures such as the introduction of a new cess on petrol and diesel, the imposition of a health cess on import of medical devices, and the expansion of the tax net through increased compliance and better enforcement. The budget also projected an increase in non-tax revenue through the disinvestment of public sector enterprises and the monetization of government assets.