What Are The 8 Most Important Budgeting Terms? | UPSC Economy

A budget is nothing but an annual financial plan that outlines the expected revenue and expenses of a government, or an individual. There are various key budget terms that help us to understand the framework of the budget.

· Revenue: Money received from taxes, fees, and other sources. It is one of the major sources of income for the government.

· Expenditure: Money spent by the government or individual for various purposes.

· Deficit: When the expenditure exceeds revenue. The difference between them is known as the deficit.

Surplus: When the revenue exceeds expenditure. The difference between them is known as Surplus.

· Capital expenditure: Money that is spent on long-term investments like building infrastructure or purchasing high-end products and equipment.

· Current expenditure: The money spent on day-to-day operations like salaries and other running costs.

· Tax Revenue: The money received by the government from taxes that are imposed on individuals and organizations.

· Non-Tax Revenue: The money received by the government from sources other than taxes like fees, royalties, and licensing 

By understanding the terminology of Budget, we can gain insight into the government’s plans for the economy and how the government is adding up new policies, and how it is planning to use its resources that are quite suitable for the needs of the citizens.

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