<div>
	Taxes and duties levied by the government form the biggest source of its income or receipts. The government spends this money on both operational and developmental needs. Usually, there are two main sources of the government&rsquo;s income &mdash; revenue receipts and capital receipts.</div>
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	Revenue receipts comprise both tax and non-tax revenues, while capital receipts consist of capital receipts and non-debt capital receipts. Non-debt capital receipts (NDCR) account for just 3 per cent of the government&rsquo;s total receipts.</div>
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	The Union government usually lists non-debt capital receipts in two categories &mdash; recovery of loans, and other receipts. Other receipts basically mean disinvestment proceeds from the sale of the government&rsquo;s share in public-sector companies.</div>
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	At a detailed level, the government divides non-debt capital receipts into more than a dozen sub-heads.</div>
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	There are two types of non-debt capital receipts, recoveries of loans and advances, and miscellaneous capital receipts.</div>
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	The recoveries of loans and advances include recovery of loans and advances from state governments and Union Territories with legislature, recovery of loans given to foreign governments, recovery of loans and advances from PSUs and other autonomous bodies.</div>
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	In miscellaneous capital receipts, proceeds from disinvestment in public-sector undertakings are included. The government classifies disinvestment proceeds into four sections:</div>
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	<li>
		Disinvestment receipts</li>
	<li>
		Strategic disinvestment</li>
	<li>
		Listing of PSUs in stock markets and</li>
	<li>
		Issue of bonus shares</li>
</ul>
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	Over the years, disinvestment has become the main source of the Union government&rsquo;s non-debt capital receipts.</div>
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RELATED BUDGET TERMS

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What is Non-debt capital receipts (NDCR), Non-debt capital receipts (NDCR) Definition, Non-debt capital receipts (NDCR) News

Non-debt capital receipts (NDCR)

What are Non-debt capital receipts (NDCR)

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	Revenue receipts can be defined as those receipts which neither create any liability nor cause any reduction in the assets of the government. They are regular and recurring in nature and the government receives them in the normal course of activities.</div>
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	Revenue receipts include the proceeds from taxes and other duties levied by the Centre; the interest and dividend it receives on its investments; and the fees and charges the government receives for its services.</div>
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	Simply put, <strong>revenue receipts must satisfy two basic conditions:</strong></div>
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	<strong>No liability:</strong> Revenue receipts do not create any liability for the government. For example, taxes received by the government, unlike borrowings, do not create any liabilities for it.</div>
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	<strong>No asset reduction: </strong>Revenue receipts do not lead to any reduction in the government&rsquo;s assets. So, the government cannot show its earnings from sale of stake in a public-sector undertaking as revenue receipts because the stake sale resulted in reduction of its assets.</div>
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	For the government, there are two sources of revenue receipts &mdash; tax revenues and non-tax revenues.</div>

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What are Revenue Receipts, News, Budget 2020 News, Revenue Receipts Definition

Revenue Receipts

<div>
	The Union Budget, which is presented by the Finance Minister of India, comprises Capital Budget and Revenue Budget. The Capital Budget is further categorised into capital receipts and capital expenditure.</div>
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	<strong>What are Capital Receipts?</strong></div>
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	Capital receipts are receipts that create liabilities or reduce financial assets. They also refer to incoming cash flows. Capital receipts can be both non-debt and debt receipts. Loans from the general public, foreign governments and the Reserve Bank of India (RBI) form a crucial part of capital receipts.</div>
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	<strong>Understanding capital receipts</strong></div>
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	Capital receipts are loans taken by the government from the public, borrowings from foreign countries and institutes, and borrowings from the RBI. Recovery of loans given by the Centre to states and others is also included in capital receipts. In the balance sheet, capital receipts are mentioned in the liabilities section. The capital receipt has a nature of non-recurrence.</div>
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	All capital receipts are tax-free, unless there is a proviso to tax it. Capital receipts can be both non-debt and debt receipts</div>
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	<strong>Non-debt capital receipts</strong></div>
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	Non-debt receipts are those which do not incur any future repayment burden for the government. Almost 75 per cent of the total budget receipts are non-debt receipts.</div>
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	<strong>Examples of non-debt capital receipts:</strong> Recovery of loans and advances, disinvestment, issue of bonus shares, etc</div>
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	<strong>Debt capital receipts</strong></div>
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	Debt Receipts have to be repaid by the government. Around 25 per cent of government expenditure is financed through borrowing. A reduction in debt receipt (or borrowing) can be a big leap for the economy&#39;s financial health. Most of the capital receipts of the government are debt receipts</div>
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	<strong>Examples of debt capital receipts: </strong>Market loans, issuance of special securities to public-sector banks, issue of securities, short-term borrowings, treasury bills, securities against small savings, state provident funds, relief bonds, saving bonds, gold bonds, external debt, etc, are all example of debt capital receipts.</div>
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What are Capital Receipts, Capital Receipts Meaning, Budget News, Capital Receipts News

Capital Receipts

<div>
	There can be different forms of deficit in a Budget depending on the type of receipt and expenditure taken into account. Revenue deficit is that which occurs when the government&#39;s total revenue expenditure exceeds its total revenue receipts. This includes those transactions that have a direct impact on the government&#39;s current income and expenditure and happens when the actual amount of revenue and/or the actual amount of spending do not correspond with the budgeted revenue and expenditure.</div>
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	<strong>What is the difference between revenue deficit and fiscal deficit?</strong></div>
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	A revenue deficit should not be confused with the fiscal deficit. If the government has a revenue deficit, it means that its income cannot cover its expenditure. A country&rsquo;s fiscal deficit, on the other hand, is the total money spent by the government in excess of its income, with the income figure including only taxes and other revenues and excluding money borrowed to make up the shortfall.</div>
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	<strong>How is revenue deficit calculated?</strong></div>
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	Revenue deficit can be calculated by subtracting total revenue expenditure from total revenue receipts. It is important to note that revenue receipts neither create liability nor lead to a reduction in assets. The opposite of revenue deficit is revenue surplus, which arises when the actual amount of net income exceeds the projected amount of expenditure. Supposing the level of fiscal deficit remains the same, a higher revenue deficit would be considered worse because that would imply a higher repayment burden in the future not matched by benefits from investment.</div>
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	Revenue deficit can be divided into two categories &mdash; receipt from tax (direct tax, indirect tax), and receipt from non-tax revenue.</div>
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	<strong>How is revenue deficit met?</strong></div>
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	To remedy a revenue deficit, the government can choose to increase taxes or cut expenses. If not remedied, a revenue deficit can adversely affect the government&rsquo;s credit rating. Running a revenue deficit may place the government&rsquo;s planned expenditures in jeopardy, as there aren&#39;t enough funds to cover the cost. The government should try to reduce its expenditure and avoid unnecessary expenditure. By identifying and employing cost-cutting measures, the government can avoid revenue deficit.</div>
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<div>
	Revenue deficit indicates dissaving on the government account because the government has to make up the uncovered gap by drawing upon capital receipts, either through borrowing or through the sale of its assets.</div>

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What is Revenue deficit, Budget News, Revenue deficit Definition

Revenue Deficit

<div>
	Current Account Deficit (CAD) is the shortfall between the money received by selling products to other countries and the money spent to buy goods and services from other nations. If the value of goods and services we import exceeds the value of those we export, the country is said to be in a deficit, and the difference in the two values is CAD.</div>
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	The current account includes net income, including interest and dividends, and transfers, like foreign aid.</div>
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	India&rsquo;s current account position is largely on the deficit side because of the country&#39;s dependence on oil imports. In the quarter ended September 2019, the country&#39;s CAD stood at $6.3 billion.</div>
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	<strong>What is Current Account and how is it different from Balance of Trade?</strong></div>
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<div>
	For a clear understanding of CAD, it&#39;s essential to learn about the current account. Quite similar to the balance of trade, current account maintains a record of the country&#39;s transactions with other nations.</div>
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	However, the two terms are technically different. While the balance of trade measures only the gap in earnings and expenditure on exports and imports of goods and services, current account also factors in payments from domestic capital deployed overseas.</div>
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What is Current Account Deficit (CAD), Current Account Deficit Definition, CAD News

Current Account Deficit (CAD)

<div>
	Public debt is the total amount, including total liabilities, borrowed by the government to meet its development budget. It has to be paid from the Consolidated Fund of India. The term is also used to refer to overall liabilities of central and state governments, but the Union government clearly distinguishes its debt liabilities from the states&rsquo;.</div>
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	The central government broadly classifies its liabilities into two categories &mdash; debt contracted against the Consolidated Fund of India, and public account.</div>
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	Over the years, the Union government has followed a considered strategy to reduce its dependence on foreign loans in its overall loan mix. Internal debt constitutes over 93 per cent of the overall public debt. Internal loans that make up for the bulk of public debt are further divided into two broad categories &ndash; marketable and non-marketable debt.</div>
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	&nbsp;</div>
<div>
	The sources of public debt are dated government securities (G-Secs), treasury bills, external assistance, and short-term borrowings.</div>
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<div>
	According to the Reserve Bank of India Act, 1934, the RBI is both the banker and public debt manager for the government. The RBI handles all the money, remittances, foreign exchange and banking transactions. The Union government also deposits its cash balance with the RBI.</div>
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	&nbsp;</div>
<div>
	The Union government&rsquo;s liabilities account for a little over 46 per cent of India&rsquo;s gross domestic product (GDP). However, if the public debt is calculated as general government liabilities, which also includes the liabilities of states, this goes up to 68 per cent of the country&rsquo;s GDP.</div>
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