Budget Basics — Set 2
Economics · बजट की मूल बातें · Questions 11–20 of 70
In Indian budgeting, what is a 'Vote on Account' used for?
Correct Answer: C. To withdraw funds for a part of the year
Vote on Account allows the government to withdraw funds for essential expenditures before the full budget is passed. It is usually sought for the first two months of the new financial year. This ensures that administrative functions do not stop during the transition.
The 'Revenue Deficit' is calculated as?
Correct Answer: B. Revenue Expenditure - Revenue Receipts
Revenue deficit occurs when the government's routine operational expenses exceed its regular income. It indicates that the government is borrowing to meet its day-to-day needs. Reducing this deficit is a key goal of fiscal consolidation.
Which of the following is considered a 'Direct Tax' in India?
Correct Answer: C. Income Tax
Direct taxes are paid directly by individuals or organizations to the government. Income tax and Corporate tax are the primary examples of direct taxes. They are generally progressive in nature, meaning higher earners pay more.
The 'Budget Division', which prepares the Union Budget, falls under which Ministry?
Correct Answer: A. Ministry of Finance
The Budget Division is part of the Department of Economic Affairs within the Ministry of Finance. It coordinates with all other ministries to finalize expenditure estimates. The Finance Secretary usually heads this department.
What does 'Primary Deficit' represent in a budget?
Correct Answer: C. Fiscal Deficit - Interest Payments
Primary deficit is the fiscal deficit minus the interest payments on past borrowings. it shows how much the government needs to borrow to meet current year's expenses excluding debt service. It helps in assessing the current fiscal sustainability.
Which document presented with the budget focuses on the long-term sustainability of government finances?
Correct Answer: D. FRBM Statement
The Fiscal Responsibility and Budget Management (FRBM) Act requires the government to present a medium-term fiscal policy statement. It sets targets for reducing deficits and debt over a period. This promotes transparency and fiscal discipline.
The 'Halwa Ceremony' in the Ministry of Finance is associated with?
Correct Answer: A. Starting the printing of budget documents
This traditional ceremony marks the beginning of the lock-in period for officials involved in budget preparation. It ensures the confidentiality of the budget documents before they are presented. Officials remain in the ministry until the budget speech is delivered.
Which among the following is an 'Indirect Tax'?
Correct Answer: B. Goods and Services Tax
Goods and Services Tax (GST) is an indirect tax levied on the supply of goods and services. The burden of this tax is shifted from the seller to the final consumer. Most other indirect taxes like excise and VAT were merged into GST.
The 'Appropriation Bill' gives the government legal authority to?
Correct Answer: D. Withdraw money from the Consolidated Fund
No money can be withdrawn from the Consolidated Fund of India without the passage of the Appropriation Bill. It specifies the amount and purpose of the expenditure authorized by the House. This is a crucial step in the parliamentary control over finances.
Which of the following is the largest source of revenue for the Union Government according to recent budgets?
Correct Answer: A. Borrowings and other liabilities
Borrowings usually constitute the single largest 'receipt' item in the government's rupee-comes-from chart. Among taxes, GST and Income Tax are major contributors. This composition varies slightly from year to year depending on economic conditions.