PUBLIC REVENUE SOURCES OF PUBLIC REVENUE Public Revenue
PUBLIC REVENUE – SOURCES OF PUBLIC REVENUE
Public Revenue • It refers to the income of the government. • There are various sources from which the government can earn its income – which are Tax, commercial revenue, administrative revenue, gifts and grants.
Tax • It is imposed by the government. People are obliged to pay it without expecting any direct return. • In other words, there is absence of direct quid pro quo. • According to Prof. Taylor – Tax is a compulsory payment to the government without expectation of any direct return or benefit to the taxpayer. • Example : Income Tax, GST, etc.
Commercial Revenue • Income earned by Public Sector Units or Public sector enterprises by selling their goods and services to the citizens of the country. • They receive payments in the form of prices. • Example: Payment for postages, milk, etc.
Administrative Revenue • One of the important functions of the government is to administer various activities. In other words, the government monitors and regulates certain activities. • In return it gets some amount of money as payment in the form of fees, fines, etc. • Example : fee paid to get license to do certain activities like driving, etc. fines paid for violation of traffic rules, etc.
Gifts and Grants • Gifts – these are offered by people within the country or friendly nations as a token of love to strengthen their relationships. • Grants – these are offered by other countries or people during times of need like war, natural calamities, etc.
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