The Budget for the year 2023-24 is around the corner. Finance Minister Nirmala Sitharaman will table the Budget on February 1. According to the Article 112 of the Constitution, the Budget is referred to as the ‘Annual Financial Statement’.
The entire budgetary process is a fairly lengthy and drawn-out process. It requires an understanding of the different stages and steps to know what the Union Budget is. Here, we take a look at the structure of the Budget and its various components. It is divided mainly into two sections —Budget Receipts and Budget Expenditures.
The Budget Receipts comprise – Capital Receipts and Revenue Receipts
Capital Receipts: Capital Receipts are the receipts that either create liability or cause a reduction in assets for the government. These receipts are paid in interest payments, recovery of loans, and disinvestment of assets to the private sector.
Revenue Receipts: Revenue Receipts are receipts that neither create any liability nor reduce the government’s assets. The revenue receipts are further divided into Tax Receipts and Non-Tax Receipts. Tax Receipts comprise Income Tax, Corporate Tax, Excuse Duty, Goods and Services Tax (GST), etc. Non-Tax Receipts comprise Fines, Special Assessments, Grants, Donations, etc.
The Budget Expenditure comprises – Capital Expenditure and Revenue Expenditure
Capital Expenditure: Capital expenditures are the expenditures that either create an asset or reduce liability for the government. These expenditures comprise Debt receipts and Non-Debt receipts. Non-Debt receipts include recoveries of loans and advances and Disinvestment receipts. Debt receipts include Borrowing. It is a debt receipt. This is the amount the government borrows and needs to repay in the future.
Revenue Expenditure: Revenue Expenditures are the expenditures that neither create any asset nor reduce any liability of the government. Revenue Expenditure includes salaries, pensions, grants during calamities, etc.
ALSO READ: Budget 2023: List Of Documents Presented In Parliament Along With The Speech