Budget 2024: A Look At How Government Earns, Spends One Rupee
On the expenditure side, interest payments on past borrowings consume the largest share at 19 paise per rupee.
With the Union Budget 2024–25, the government also released a bifurcation, explaining how its revenue is sourced and where it is spent.
The revenue is primarily sourced from taxes, with 63 paise of every rupee earned coming from direct and indirect taxes. Direct taxes, including income and corporate taxes, contribute 36 paise. Indirect taxes, such as the goods and services tax, excise and customs duties, add up to 27 paise.
Non-tax revenue like disinvestment contributes 9 paise and non-debt capital receipts make up 1 paise of the government's earnings.
On the expenditure side, interest payments on past borrowings consume the largest share at 19 paise per rupee, reflecting the substantial financial commitment to servicing existing debts. States receive 21 paise as their share of taxes and duties, supporting decentralised governance and regional development initiatives.
Central-sector schemes, crucial for nationwide development initiatives, receive 16 paise per rupee, while centrally sponsored schemes are allotted 8 paise. Defence expenditure also accounts for 8 paise, ensuring national security readiness and modernisation efforts.
The Finance Commission and other transfers constitute 9 paise, facilitating equitable distribution of resources across states. Subsidies to support various sectors and pensions for retired personnel collectively account for 10 paise (6 paise for subsidies and 4 paise for pensions), addressing social welfare and economic stabilisation needs.
The government earmarks 9 paise for other essential expenditures, ensuring operational continuity and infrastructure maintenance across various departments and agencies.
