Question

The non-tax revenue in the following is:

• A. Export duty
• B. Import duty
• C. Dividends
• D. Excise duty

Hint:

To identify non-tax revenue, ask: "Is this a compulsory payment levied by law (tax), or is it income from a service, fine, or government-owned business?" Profits, dividends, fees, and fines are key examples of non-tax revenue.

Answer 1

The Correct Option is C

Step 1: Understanding the Concept:
Government revenue is broadly classified into Tax Revenue and Non-Tax Revenue. \begin{itemize} \item Tax Revenue: Compulsory payments levied by the government on individuals and corporations. Examples include income tax, corporate tax, GST, customs duties (import/export), and excise duty. \item Non-Tax Revenue: Revenue earned by the government from sources other than taxes. Examples include fees, fines, profits from public sector undertakings (PSUs), and interest receipts. \end{itemize}

Step 2: Detailed Explanation:
Let's analyze the given options: \begin{itemize} \item (A) Export duty: This is a tax on goods exported from the country. It is tax revenue. \item (B) Import duty: This is a tax on goods imported into the country (a type of customs duty). It is tax revenue. \item (D) Excise duty: This is a tax on the manufacture of goods within the country. It is tax revenue. \item (C) Dividends: This is the share of profit that the government receives from its investments in Public Sector Undertakings (PSUs) and other companies. This is a form of profit, not a tax. \end{itemize}

Step 3: Final Answer:
Dividends represent income from government investments and are a source of non-tax revenue. The other options are all types of taxes. Therefore, option (C) is the correct answer.