What is meant by non-tax revenue? Explain the different sources of non-tax revenue

Question 2. What is meant by non-tax revenue? Explain the different sources of non-tax revenue
Class  Class 12
Subject Economics (Macroeconomics)
Category Class 12 Economics Solutions Sandeep Garg

Sandeep Garg Macroeconomics Class 12 Solutions Circular flow of Income – Long Questions Q.2 What is meant by non-tax revenue? Explain the different sources of non-tax revenue

Solution:-

Non-Tax revenue refers to those revenue receipts of the government which is not a part of its tax receipts. Various sources of non-tax revenue are: –




  1. Interest: – Government receives interests on loan, it has advanced to various state governments, public, international organizations, foreign countries etc. This is a recurring revenue source for the government.
  2. Profits from PSUs: – Profits of various PSUs like LIC, BHEL, Indian Railways goes into government treasury. These profits are an important source of non-tax revenue for the government.
  3. Dividends: – Government receives dividends from the investments it makes in other companies. This also forms a part of governments revenue.
  4. Fees: – Fees refers to the amount of money charged by Government for rendering some important services. It is only charged to those who avail these services. Example of such services are issuing birth certificate, death certificate, court fees etc.
  5. Fines and Penalties: – These are imposed on those who break the law of the land. These act as important source of non-tax revenue for the government. Some examples are fine on jumping red light, fine on not wearing helmets etc.
  6. Escheats: – Escheats refers to the legal claim of government on a person’s property who dies without leaving an heir or a will.
  7. Gifts and Grants: – Government receives gifts, grants and monetary help from international organizations, foreign government, corporates and its citizens. Its an irregular source of income and is generally received during war time or national crisis.




Long Questions – Sandeep Garg Macroeconomics Class 12 Solutions Government budget and the Economy

Sandeep Garg Macroeconomics Class 12 Solutions

Part A: Introductory Macroeconomics
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