Which item is best classified as non-tax revenue for a government?
Correct answer: C. Fees charged for government services
- A. Income collected from personal income tax
- B. Receipts from customs duties
- C. Fees charged for government services
- D. Borrowing from domestic banks
Explanation
Fees for licences, permits, and public services are non-tax revenues because they are not compulsory taxes. Income tax and customs duties are tax revenues, while borrowing creates a financing liability rather than revenue in the usual budget classification.
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About Public Finance
Government revenue and expenditure are analysed through taxation, public borrowing, budgets, subsidies, transfers and public debt. The topic explains how fiscal policy affects resource allocation, income distribution, economic stability and growth, while distinguishing direct from indirect taxes, progressive from regressive taxation, and public goods from goods supplied by private markets.
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