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India's Union Budget for financial year 2027 estimated that ** percent of every rupee earned by the government comes from borrowings and liabilities. Income tax would account for ** percent of government earnings, whereas corporation tax would account for ** percent. Currently, about two-thirds of the government's income comes from taxes.

What are revenue receipts?

As per the Union Budget, government income consists of revenue and capital receipts. Revenue receipts include direct and indirect taxes. Direct taxes, such as personal income tax, corporate tax, and capital gains tax, are paid by individuals and businesses. Indirect taxes, on the other hand, are levied on goods and services and include goods and services tax (GST), customs, and excise duties. 

What are capital receipts?

Capital receipts are receipts that create liabilities or reduce financial assets. Capital receipts can be either debt or non-debt. Debt capital receipts raise the government’s liabilities. This includes net borrowing at home, RBI borrowings, and loans from foreign governments. Non-debt capital receipts are not borrowed money and do not result in debt. These include the recovery of loans and earnings from the sale of PSU (public sector undertakings) shares, also known as disinvestment.