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Is the Following Revenue Expenditure Or Capital Expenditure in the Context of Government Budget? Give Reason. Expenditure on a Collection of Taxes.

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Question

Is the following revenue expenditure or capital expenditure in the context of government budget? Give reason.

Expenditure on a collection of taxes.

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Solution

Expenditure on the collection of taxes is revenue expenditure. This expenditure has no decline in government liabilities and does not create assets for the government. For example, salaries, pensions and interest payments.

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2013-2014 (March) Delhi Set 1

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