Which of the following is/are an example of a non-tax revenue receipt?
Show answer & explanation
Correct answer: D
Explanation
The correct answer is option 4 i.e. Interest Income.
Interest income is a classic example of a non-tax revenue receipt for the government. It refers to the earnings the government receives from loans it has extended to states, public sector enterprises, or even foreign governments. Unlike taxes, which are compulsory levies, non-tax revenues arise from the government’s economic activities and services. These receipts help fund public expenditure without imposing direct taxes on citizens. Other examples of non-tax revenue include dividends from public sector units, fees, fines, and profits from government-run enterprises.
Other options :
- Investment: Not a revenue receipt; it's an expenditure or asset allocation by the government or individuals.
- Income Tax: A tax revenue receipt, not non-tax; it's collected directly from individuals and businesses.
- External Commercial Borrowings: These are loans taken by private companies from foreign sources; not a government revenue receipt.