question_answer

From the following data about a government budget find (a) Revenue deficit, (b) fiscal deficit and (c) primary deficit
S. No.	Items	(Rs. Arab)
(i)	Tax revenue	47
(ii)	Capital receipts	34
(iii)	Non-tax revenue	10
(iv)	Borrowings	32
(v)	Revenue expenditure	80
(vi)	Interest payments	20

Answer:

(a) Revenue Deficit = Revenue Expenditure - Revenue Receipts

Where, Revenue Receipts = Tax Revenue + Non Tax Revenue

= (v) - (i) - (iii)

\[=80-47-10=Rs.\text{ }23\text{ }Arab\]

(b) Fiscal Deficit - Revenue Expenditure - Revenue Receipts + Capital Expenditure - Capital Receipts Net of Borrowings = Revenue Expenditure - Tax Revenue - Non-tax Revenue - (Capital Receipts - Borrowings)

= (v) - (i) - (iii) [(ii) - (iv)]

\[=80-47-10-(34-32)\]

\[=112-91=Rs.\text{ }21\text{ }Arab.\]

(c) Primary deficit = Fiscal Deficit - Interest Payments

\[=21-20=Rs.\text{ }1\text{ }Arab.\]