Public Finance in India

Public Finance deals with the income and expenditure of the government. It has two main components: Public Revenue and Public Expenditure. Public Revenue refers to the government's sources of income, which are categorized into Tax Revenue (like income tax, GST) and Non-Tax Revenue (like fees, fines, and profits from public sector enterprises). Public Expenditure is the spending by the government, classified into Revenue Expenditure (recurring, day-to-day expenses) and Capital Expenditure (creation of assets). The government's annual financial statement is the Budget, which outlines planned revenue and expenditure. A budget can be balanced, surplus, or deficit. Understanding these components is key to analyzing the government's role in the economy.