Economic survey of India covers the important current affairs aspects in the Indian economy. This is very important for UPSC IAS Prelims examination. The Budget presentation to the Parliament in India is a significant economics occasion. The Budget arrays economic policy of the Government for the coming fiscal year. The Union Budget covers several economic terms which are hard to understand, leaving the UPSC aspirants muddled.
Here we are giving 10 important terms in the Union Budget that you should know for UPSC Civil Services IAS Prelims Exam 2019.
Taxes are levied by the government for public expenditure. There are many different types of taxes like income, corporate, sales, wealth and environmental taxes. The two major classifications of taxes are the direct tax and the indirect tax which is a highlight in Union budget.
- Taxes which is imposed directly on individual and company
- It comprises income tax and corporation tax
- Taxes which are imposed on goods and services
- It comprises taxes like service tax, excise taxes, and custom duties
- The policy of the government
- Fiscal policy is the means by which a government adjusts its expenditure levels and tax rates to monitor and influence a country’s economy.
- Budget receipts further classified as:
- Revenue receipts
- Capital receipts
- The receipts received which cannot be recovered by the government
- It comprises income amassed by the Government through taxes and non-tax sources like interest, dividends on investments.
- Receipts which generate liability or decrease the financial assets of the government.
- It includes borrowings from the Reserve Bank of India and commercial banks and other financial institutions.
- It also consists of loans received from foreign governments and international organization and repayment of loans granted by the Union government.
- Expenditure incurred by the Union Government for purposes other than for the creation of physical or financial assets.
- It includes those expenditures incurred for the usual functioning of the government departments, grants given to state governments and interest payments on debt of the Union Government etc.
- Spending incurred by the government which results in the formation of physical or financial possessions of the Union government or decrease in financial liabilities of the Union Government.
- It contains expenditure on procuring land, equipment, infrastructure, expenditure in shares.
- It also includes mortgages by the Union government to Public Sector Undertakings, state and union territories
- It is the additional expenditure of government over revenue receipts.
- It is the difference between the total expenditure of government and its total receipts, not including the borrowing.
- Fiscal deficit – interest payments= Primary Deficit
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