About Lesson
ii. Revenue Expenditure
Revenue Expenditure is expenditure incurred for purposes other than the creation of physical or financial assets. Thus, these expenses do not yield any revenue in the future.
Some major components of the Revenue Expenditure include expenses incurred for the purpose of
- Day-to-day functioning of the government departments
- Salaries, pensions, subsidies, interest payments
- Offering various services to citizens.
- Interest payments on debt incurred by the government
- Grants given to State Governments and other parties (even though some of the grants may be meant for creation of assets).