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    Frequently asked questions about the Budget

    The Union Budget is India’s annual report as a country. It contains the Government of India's revenue and expenditure for the end of a particular fiscal year, which runs from April 1st to March 31st every year. The Union Budget is the most extensive account of the government's finances, in which revenues from all sources and expenses of all activities undertaken are aggregated. It comprises the revenue budget and the capital budget. It also contains estimates for the next fiscal year.

    This is the gap between the government's total spending and the sum of its revenue receipts and non-debt capital receipts. It represents the total amount of borrowed funds the government requires to meet its expenditures completely.

    The Capital Budget differs from the Revenue Budget as it focuses on long-term components. It includes:
    • Capital Receipts: Government loans from the public, Reserve Bank borrowings, treasury bills, foreign loans, equity divestment in public enterprises, securities against small savings, state provident funds, and special deposits.
    • Capital Payments: Spending on assets like land, buildings, and machinery, as well as investments in shares, and loans to state governments, government companies, and corporations.

    Direct tax is levied on individuals and corporations for incomes generated by them—for example, income tax and corporate tax. Indirect tax is imposed on goods and services—for example, GST.

    Deficit financing means generating funds to finance the deficit resulting from excess expenditure over revenue. The gap is being covered by borrowing from the public by the sale of bonds or by printing new money.

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