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FISCAL POLICY Government Expenditure PART 3 Government Esxpenditure BY AYUSSH SANGHI
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Government Expenditure * It is also known as Public Expenditure. It is also known as Public Expenditure. Government expenditure can be classified under the following heads: Revenue Expenditure, k Capital Expenditure
Capital Expenditures * CE of the government are those expenditures which result in creation of physical or financial assets or reduction in financial liabilities.
Capital Expenditures These include: expenditure on acquisition of land, k building, sk equipment, investment in shares.
Capital Expenditures These also include: *loans and advances by the central government to: state government and * union territory governments, PSUs and k other parties.
Revenue Expenditures RE is expenditure incurred for purposes other than the: creation of physical or financial assets s of the central government. of the central government.
Revenue Expenditures It relates to: expenses incurred for the normal functioning of the government departments and various services, interest payments on debt incurred by the government, and grants given to state governments and other parties
Types of Expenditures The Budget documents classify total expenditure into the following: k plan expenditure and non-plan expenditure.
Types of Expenditures The Budget documents classify total expenditure into the following: plan expenditure and non-plan expenditure. Both Capital and Revenue expenditure is also categorised as plan and non-plan in the budget documents.
Non - Plan Capital Expenditure It includes: Defence Equipments and modernisation of current ones, Loans to Public sector companies and Loans to states and union territories