Economics XI Content
The revenues from different sources received by the government are called public revenues. Some are regularly collected whereas some are irregularly collected. Revenues are not repayable. Some of them are obtained from the sale of public utilities whereas some are obligatory payments to the government.
Types or sources of government (public) revenue
The public revenue can be classified into tax revenue and non tax revenue:
The tax is compulsory payment to the government without quid pro quo. The government does not repay back it to the payers nor does it do anything for the personal benefit to the payers. It is very effective fiscal tool essential for the achievement of different socio-economic objectives. There are mainly two types of tax.
1. Direct tax:
The tax that is not shiftable in nature and paid by the payers who really take its burden is called direct tax. The person or organization which faces the incident taxes the burden too. The taxes imposed in income, profit, land, houses, vehicles etc are called direct taxes.
2. Indirect taxes:
It is the tax shiftable in nature. The person or organization which faces the incident of tax is different from person or organization who really takes the burden of tax. The incident is faced by the producers and traders but the burden is taken by the final consumers. The tax is imposed on production, sales, export and imports etc. The taxes like excise duty, custom duty, entertainment tax, octroi charges etc are indirect taxes. The VAT is also called indirect tax
Non tax revenue
The government receives the money from the sale of different services like health, education etc. Moreover it takes fees for registration, license etc. The examples of fees are education fee, health fee, registration fee (birth, death, marriage, organization etc) license fee (driving, share broker, export, import, pistols) etc.
2. Fines and penalties:
Against the violation of rules and regulations the government charges the fines but if there is violation of law and order government charges penalties. Fines and penalties are not regular source of government revenue.
The government receives the royalties its production right, copy right, public land and building, capital equipment and plants for use to others. It obtains dividends from public enterprises, rents from public properties etc. this is also regular source of public revenue.
The government collects different types of cess like road cess, pool cess etc in order to recover he construction cost and to reach the fund for maintenance of the construction.
5. Grants and donation:
The government receives the grants and donations from the people, business organization, NGOs, within the country or outside the country. It obtains grants from foreign government too.
The nationalized properties of people after the death being unclaimed are called escheats. This is irregular source of government revenue.