Public Revenue

PUBLIC REVENUE

PUBLIC FINANCE

Darshan Joshi Batch: SMBA27 Roll No: 18

TABLE OF CONTENTS


INTRODUCTION CLASSIFICATION TAX REVENUE

CANONS OF TAXATION DIRECT TAXES

MERITS AND DEMERITS INDIRECT TAXES

MERTIS AND DEMERITS NON TAX REVENUE TAX COLLECTION GRAPHICAL REPRESENTATION BIBLIOGRAPHY

INTRODUCTION


Government needs to perform political, social and economic duties so as to maximize social and economic welfare. In order to perform these duties and functions government requires large amount of resources .

These sources of revenue to the governments, viz. Central, State and Local Governments, are called Public Revenues.

Development of agriculture, industries & infrastructure, defense, maintenance of law & order, conducting elections, serving public debt & any unforeseen expenses.

CLASSIFICATION


Public Revenue

Tax Revenue

Direct TaxesIncome Tax, Wealth Tax, Corporate

Tax, Capital Gains Tax, Gift Tax,

Securities Transaction Tax, Estate

Duty, Perquisite Tax, Etc

Indirect TaxesSales Tax,

Service Tax, VAT,

Customs & Octroi Duty, Excise Duty, Professional

Tax, Municipal

Tax, Entertainme

nt Tax, Education Cess, Etc

Non Tax Revenue

Profits from PSU, Administrative Fees, Fines & Forfeitures,

Hidden Resources, Escheats, Financial Aid, Public Debt,

Capital Gains Fund

TAX REVENUE


Tax is a compulsory contribution of the wealth of a person that is to say, it involves a sacrifice on the part of the contributor.

Tax Revenue is the income gained by governments through taxation.

Who is required to pay tax?Ans: There is a saying that only two things in life are

certain: Death and Taxes. Every individual pays tax, either directly or indirectly. This implies that the burden of taxation is on anyone and everyone.

CANONS OF TAXATION


Canon of Equity Canon of Certainty Canon of Convenience Canon of Economy Canon of Productivity Canon of Simplicity Canon of Elasticity Canon of Diversity

SMITH’S CANONS

MODERN CANONS

DIRECT TAX


Direct tax is a tax imposed and collected directly from person on whom it is legally imposed.

The burden of it falls on one person and cannot be shifted to another person.

Income Tax, Wealth Tax, Corporate Tax, Capital Gains Tax, Gift Tax, Securities Transaction Tax, Perquisite Tax, Estate Duty are Direct Taxes.

MERITS V/S DEMERITS OF DIRECT TAXES


MERITS DEMERITS

Just and Equitable

Progressive

Elastic

Productive

Anti-Inflationary

Effective

Certain

Arbitrary

Unpopular

Inconvenient

Evasion

Uneconomical

Narrow Base

Tax on Honesty

INDIRECT TAXES


Indirect Tax is collected by an intermediary from the person who bears the ultimate burden.

An indirect tax is one that can be shifted by the taxpayer to someone else.

Sales Tax, Service Tax, Value Added Tax (VAT), Customs and Octroi Duties, Excise Duty, Professional Tax, Municipal Tax, Entertainment Tax, Education Cess, Etc. are Indirect Taxes.

MERITS V/S DEMERITS OF INDIRECT TAXES


MERITS DEMERITS

Convenient

No Tax Evasion

Broad Tax Base

Social Value

Economical

Effective

Progressive

Unjust

Inflationary

Uncertain

Savings Affected

Not Economical

No Link

Inequitable

NON TAX REVENUE


Non Tax Revenue includes all revenues other than taxes, accruing to the Government.

Revenues mobilized from sources other than taxes are called Non-Tax revenue.

Profits from PSU, Administrative Fees, Fines & Forfeitures, Hidden Resources, Escheats, Financial Aid - Gifts, Indemnities, Public Debt, Capital Gain Fund are Non Tax Revenues.

TAX COLLECTION


Particulars 1990-91 2000-01 2010-11 2011-12 2012-13

A) Tax Revenue 87723.28

305320.24

1271665.35

1475032.29

1751123.51

1) Direct Taxes 12260.11

71763.57 450822.09 507888.09 578364.02

2) Indirect Taxes 75463.17

233556.67

820843.26 967144.20 1172759.49

B) Non Tax Revenue

12286.78

49361.79 266926.13 178693.09 226891.32

Rs. In CroresIn Crores

GRAPHICAL REPRESENTATION


1990-91 2000-01 2010-11 2011-12 2012-1387723.28

305320.24

1271665.351475032.29

1751123.51

12286.78

49361.79

266926.13

178693.09226891.32

Public Revenue

Tax Revenue Non Tax Revenue

CONCLUSION


Revenue earned by the government is used to incure developmental and non-developmental expenses.

Government should design ways to develop multiple sources of revenue to reduce dependence on any one.

A just and fair tax system should be designed keeping in mind both Smith’s as well as Modern Canons of Taxation.

A good tax system is required for the over all development of any economy.

BIBLIOGRAPHY


WEB BASED

Ministry of Finance, Govt. of India: www.finmin.nic.in Income Tax Dept. : www.incometaxindia.gov.in

BOOK BASED

Public Revenue – By Prof. S.N.Chand Macro Economics – By Prof. Michael Vaz

THANK YOU


Public Revenue

Economy & Finance

Transcript of Public Revenue