Budget is a statement of expected receipts and expenditue of the government over the period of financial year(i.e, April 1st to 31st March).
| Basis |
Revenue Expenditure |
Capital Expenditure |
| Meaning |
Revenue expenditure neither creates any asset nor reduces any liability of the government. |
Capital expenditure either creates an asset or reduces the liability of the government. |
| Purpose |
It is incurred for normal running of government departments and provision of various services. |
It is incurred mainly for acquisition of assets and granting of loans and advances. |
| Nature |
It is recurring in nature as such expenditure is spent by government on day-to-day activities. |
It is non-recurring in nature. |
| Example |
Salary, pension, interest etc. |
Repayment of borrowings, expenditure on acquisition of capital asset, etc. |
