The Budgetary Trends Inwards India Budget - 1990-91 Together With 2005-06

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A. Trends inward Revenue Budget ↓

1. Revenue Receipts : They consist of taxation together with not taxation revenue. Revenue receipts accept increased from Rs. 54,954 crores inward gross domestic product inward 1990-91 to Rs. 3,43,833 crores inward 2005-06. Revenue receipts were 9.7% of gross domestic product inward 1990-91 together with 9.6% inward 2005-06. The percentage of taxation revenue inward the full revenue receipts was 81% inward 2006-07.
2. Tax Measures together with Reforms : Reforms of the taxation construction accept been an of import business office of the structural reforms introduced through the budgets since 1991-92. The strategy was to deed towards a simpler organization of taxation alongside moderate rates, fewer exemptions together with wider taxation base. These principles are beingness implemented inward representative of both forthwith together with indirect taxes. All major forthwith together with indirect taxation rates accept been reduced. In 2006-07, the authorities raised Rs. 3,27,205 crores inward taxation revenue every bit compared to Rs. 42,978 crores inward 1990-91.
3. Revenue Expenditure : Revenue expenditure has been increasing continuously. It has increased from Rs. 73,516 crores inward 1990-91 to Rs. 4,38,252 crores inward 2005-06. As proportion of GDP, revenue expenditure was 12.9% inward 1990-91 together with 12.3% inward 2005-06. Defence expenditure increased from Rs. 10,874 crores inward 1990-91 to Rs. 51,542 crores inward 200607. Interest payments constituted the largest proportion of revenue expenditure. In 1990-91, it was Rs. 21,500 crores together with inward 2006-07 it stood at Rs. 1,39,823 crores. In trouble alongside the policy of the authorities trim down subsidies past times targeting them inward favour of the miserable together with the needy, full subsidies every bit percent of gross domestic product has declined from 1.8% inward 1990-91 to 1.2% inward 2005-06.

B. Trends inward Capital Budget ↓

Capital budget consists of working capital missive of the alphabet receipts together with working capital missive of the alphabet expenditures. inward working capital missive of the alphabet receipts borrowings from the market, external loans, pocket-sized savings, provident funds together with the deposits from LIC together with GIC accounted for 76% of the full working capital missive of the alphabet receipts inward 1990-91. In 1999-2000 this went upwards to 90%. Over the years in that place has been substantial increment inward the borrowings past times the center.

Capital expenditure consists of working capital missive of the alphabet investments, world debt repayment together with loans together with advances to the states for financing projects. Capital expenditure is past times together with large financed past times borrowing from internal sources. The percentage of working capital missive of the alphabet expenditure to full expenditure was 35% inward 1980-81 together with 22% inward 1999-2000.

C. Trends inward Plan together with Non-Plan Expenditure ↓

Non excogitation expenditure of the fundamental authorities incorporate of involvement payments, defence, subsidies together with not excogitation grants together with loans to states.

For many years the growth of not excogitation expenditure has been faster than the growth of excogitation expenditure. Non excogitation expenditure increased past times 5.3 times betwixt 1980-81 together with 1990-91, piece excogitation expenditure increased past times three times inward the same period.

However, alongside the introduction of reforms this tendency has been reversed. In the get-go 2 years of reforms process, the increment inward not excogitation expenditure was exclusively 11.7% against an increment of 29.2% inward excogitation expenditure.