Major Source of Revenue Receipts for the Government

The revenue receipts of the government are the inflows of funds received by the government from various sources. The government uses these funds to undertake various developmental and welfare activities. The major sources of revenue receipts for the government are:

1. Tax Revenue: Tax revenue is the most significant source of revenue for the government. The taxes collected by the government include direct and indirect taxes such as income tax, corporate tax, customs duty, excise duty, service tax, and sales tax.

2. Non-Tax Revenue: Non-tax revenue includes various other receipts such as interest on loans, dividends from public sector undertakings, fees, fines, and penalties.

3. Grants-in-Aid: Grants-in-aid are the funds received by the government from foreign countries or international organizations for developmental and welfare activities.

4. Borrowings: The government also raises funds through borrowings from various sources such as banks, financial institutions, and the public.

5. Profits: Profits earned by government-owned companies such as Oil and Natural Gas Corporation (ONGC), Bharat Petroleum Corporation Limited (BPCL), and Coal India Limited (CIL) also contribute to the revenue receipts of the government.

Conclusion

Therefore, it can be concluded that profits earned by government-owned companies are one of the significant sources of revenue receipts for the government. However, it is not the major source of revenue as tax revenue contributes the most significant share of revenue receipts for the government.

Revenue receipts are those receipts which neither create any liability nor cause any reduction in the assets of the government.
They are regular and recurring in nature.
There are two sources of Revenue receipts:
Tax revenue
Non-tax revenue

(D) is the correct answer because Profits is a non-tax revenue. Government earns profit through public sector undertakings (PSUs) like Indian railways, LIC etc.