alleryStart learning →Which pair counts as non-debt creating capital receipts?
ARecovery of loans and PSU sale proceeds
BIncome tax and corporation tax
CMarket borrowing and RBI loans
DExcise duty and customs duty
Answer & Solution
Correct answer: A. Recovery of loans and PSU sale proceeds
1. Non-debt creating receipts bring in money without adding to debt.
2. **Recovery of loans** returns money already lent out.
3. **PSU sale proceeds** convert an asset into cash.
4. Market borrowing does create debt, and the tax options are revenue receipts, not capital ones.
_Source: syllabus Introductory Macroeconomics, Ch 5 "Government Budget and the Economy", section 5.2.1 Measures of Government Deficit_
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