| Is the following a revenue receipt or a capital receipt in the context of government budget and why? |
| (i) Tax receipts |
| (ii) Disinvestment |
Answer:
(i) Tax receipts are revenue receipts as these receipt neither creates any liability nor it creates any reduction in the assets of the government. (ii) Disinvestment is treated as capital receipts because results in the reduction of government assets.
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