This document defines and describes key aspects of government budgets. It discusses the types of budgets including balanced, surplus, and deficit budgets. It also defines revenue and capital budgets. Revenue receipts include tax and non-tax revenues such as direct and indirect taxes. Expenditures are classified as revenue or capital, and plan or non-plan. Deficits include budget, revenue, fiscal, and primary deficits. Implications of revenue and fiscal deficits are also covered.

1. BUDGET
PRESENTED BY
UMESH KUMAR BHARDWAJ
PGT ECONOMICS
JNV PATIALA

2. DEFINATION
THE BUDGET IS AN ANNUAL
STATEMENT OF THE
ESTIMATED RECEIPT AND
EXPENDITURE OF THE
GOVERNMENT OVER A
FINANCIAL YEAR IN AN
ECONOMY.

3. TYPES OF BUDGET
1.BALANCED BUDGET
ESTIMATED GOVERNMENT RECIEPT=
ESTIMATED GOVERNMENT EXPENDITURE
2. SURPLUS BUDGET
ESTIMATED GOVERNMENT RECIEPT>
ESTIMATED GOVERNMENT EXPENDITURE
3.DEFICIT BUDGET
ESTIMATED GOVERNMENT RECIEPT<
ESTIMATED GOVERNMENT EXPENDITURE

4. BUDGET
REVENUE BUDGET CAPITAL BUDGET

5. REVENUE
BUDGET
REVENUE
EXPENDITURE
REVENUE
RECIEPT

6. CLASSIFICATION
OF
PUBLIC
EXPENDITURE
REVENUE AND
CAPITAL
EXPENDITURE
PLAN AND NON
PLAN
EXPENDITURE
DEVELOPMENTAL
AND
NON
DEVELOPMENTAL
EXPENDITURE

7. REVENUE
RECEIPT
TAX REVENUE
NON TAX
REVENUE

8. TAX REVENUE
DIRECT TAX INDIRECT TAX

9. NON TAX
REVENUE
COMMERCIAL
REVENUE
ADMINISTRATIVE
REVENUE

10. CAPITAL RECIEPTS
GOVERNMENT RECIEPTS
WHICH CREATE
LIABILITIES OR REDUCE
ASSETS ARE CALLED
CAPITAL RECIEPTS.

11. COMPONENTS OF CAPITAL
RECIEPTS
1. BORROWING(DOMESTIC &
EXTERNAL)
2. RECOVERY OF LOANS AND
ADVANCES
3. DISINVESTMENT
4. SMALL SAVINGS

12. REVENUE RECEIPTS
GOVERNMENT RECIEPTS
WHICH DO NOT CREATE
LIABILITIES OR CAUSE
ANY REDUCTION IN
ASSETS ARE CALLED
REVENUE RECIEPTS.

13. TAX REVENUE
DIRECT TAX
 Liability to pay
and the burden
of direct tax falls
on the same
person.
 Burden to this
tax cannot be
shifted to others.
INDIRECT TAX
 Liability to pay
this tax is on one
person and the
burden of the tax
falls on some
other person
 Its burden can
be shifted to
others.

14. EXAMPLES
DIRECT TAX
1.INCOME TAX
2.CORPORATIO
N TAX
3.WEALTH TAX
4.GIFT TAX
INDIRECT TAX
1.SALES TAX
2.CUSTOM
DUTY
3.EXCISE DUTY
4.SERVICE TAX

15. CAPITAL EXPENDITURE
 AN EXPENDITURE WHICH EITHER CREATES
AN ASSET OR REDUCES A LIABILITY IS
CALLED CAPITAL EXPENDITURE.
EX:-Acquisition of assets like land, buildings,
machinery, equipment, investment in
shares etc.
 IT CAN BE OF TWO TYPES:-
 PLAN EXPENDITURE
 NON PLAN EXPENDITURE

16. REVENUE EXPENDITURE
1.AN EXPENDITURE WHICH NEITHER
CREATES ASSETS NOR REDUCES LIABILITY
IS CALLED REVENUE EXPENDITURE.
2.GENERALLY EXPENDITURE INCURED ON
NORMAL RUNNING OF THE GOVERNMENT
DEPARTMENT AND MAINTNANCE OF
SERVICES IS TREATED AS REVENUE
EXPENDITURE.
3.IT CAN BE OF TWO TYPES AS PLAN AND
NON PLAN.

17. PLAN EXPENDITURE
REFERS TO THE ESTIMATED
EXPENDITURE WHICH IS
PROVIDED IN THE BUDGET TO
BE INCURRED DURING THE
YEAR ON IMPLEMENTING
VARIOUS PROJECTS AND
PROGRAMMES.

18. NON PLAN EXPENDITURE
 ESTIMATED EXPENDITURE
PROVIDED IN THE BUDGET FOR
SPENDING DURING THE YEAR
ON ROUTINE FUNCTIONING OF
THE GOVERNMENT.

19. EXAMPLES OF PLAN EXPENDITURE
 CENTRAL PLANS:-ASSISTANCE TO
FINANCE STATE AND UNION
TERITARY PLANS(REVENUE
EXPENDITURE)
 CENTRAL PLANS:-LOANS TO STATE
AND UNION TERITARY FOR THEIR
CAPITAL PROJECTS(CAPITAL
EXPENDITURE)

20. EXAMPLES OF NON PLAN
EXPENDITURE
 INTEREST PAYMENT, SALARIES,
DEFENCE, SUBSIDIES(REVENUE
EXPENDITURE)
 DEFENCE EXPENDITURE, LOANS TO
STATE AND UNION TERITARY, LOANS
TO PUBLIC, LOANS TO FOREIGN
GOVERNMENT.

21. DEVELOPMENT EXPENDITURE
IT IS RELATED TO ECONOMIC
AND SOCIAL DEVELOPMENT OF
THE COUNTRY e.g Expenditure
on education, health,
agriculture etc.

22. NON DEVELOPMENT EXPENDITURE
 IT IS RELATED TO EXPENDITURE ON
ESSENTIAL GENERAL SERVICES OF
THE GOVERNMENT.
E.g. Expenditure on police, judiciary,
defense, general administration etc.

23. TYPES OF BUDGET
BUDGETARY DEFICIT
REVENUE DEFICIT
FISCAL DEFICIT
PRIMARY DEFICIT

24.  BUDGET DEFICIT= TOTAL
EXPENDITURE-TOTAL RECEIPTS
 REVENUE DEFICIT=REVENUE
EXPENDITURE-REVENUE RECIEPTS
 FISCAL DEFICIT=TOTAL BUDGET
EXPENDITURE-TOTAL BUDGET
RECEIPTS EXCLUDING BORROWING
 FISCAL DEFICIT=TOTAL
EXPENDITURE-(REVENUE RECIEPTS-
NON DEBT CAPITAL RECEIPTS)
 PRIMARY DEFICTS=FISCAL DEFICITS-
INTERREST PAYMENTS

25. IMPLICATIONS OF REVENUE
DEFICITS
Revenue deficits indicates dis savings on
government account because government
has to make up the uncovered gaps by
drawing upon Capital receipts through sale
of its assets
 It results in reduction of assets
 It leads to inflationary situation in the
economy.
 Large borrowing to meet RD will increase
debt burden which leads to larger and
larger revenue deficits.

26. IMPLICATIONS OF FISCAL
DEFICITS
 It is the borrowing requirement of the
country.
 It creates the problem of interest.
 It creates problem of repayment of
loans.
 It leads to wasteful and unnecessary
expenditure by government.

27. THANK-YOU