Question

Non-debt creating capital receipts give rise to debt.

• A. True
• B. False

Answer 1

The correct option is B False

Non-debt creating capital receipts are those money receipts which are received by the government from the sale of old assets. These receipts are not treated as liabilities of the government. Examples of non-debt creating capital receipts are recovery of loans, proceeds from sale of public enterprises, etc. Hence, it does not give rise to debt.