Question

Which of the following is not a revenue receipt?

• A. Recovery of loans
• B. Foreign grants
• C. Profits of the public enterprises
• D. Wealth tax

Hint:

Revenue receipts are income received by the government that does not create any liability, like taxes, grants, and profits from public enterprises.

Answer 1

The Correct Option is A

Step 1: Understanding Revenue Receipts:
Revenue receipts refer to the money received by the government in the form of taxes or other income that does not result in a liability for the government. These receipts are typically non-repayable. Examples include tax collections, profits from public enterprises, and foreign grants.
Step 2: Analyzing the Options:
- Option (A) Recovery of loans: This is not a revenue receipt. When the government recovers loans, it is essentially a return of the principal amount, not income. Therefore, it is not counted as a revenue receipt.
- Option (B) Foreign grants: Foreign grants are considered revenue receipts because they are a form of income that the government receives, typically for specific purposes.
- Option (C) Profits of the public enterprises: Profits from public enterprises are also revenue receipts, as they represent income generated by the government's business operations.
- Option (D) Wealth tax: Wealth tax is a form of income that the government collects, making it a revenue receipt.
Step 3: Conclusion and Answer:
The correct answer is (A) because the recovery of loans is not considered a revenue receipt, as it involves the return of borrowed funds, not new income.