How can revenue d
● Revenue deficit is the excess of total revenue expenditure of the government over its total revenue receipt.
● Revenue deficit = expenditure minus total revenue receipt.
● It indicates the dissaving of the government because the government has to make up for the uncovered gap.
● It is done by using the capital receipts either by borrowing or through selling its assets.
● The government usually uses its capital receipt to meet the consumption expenditure which leads to an inflationary situation in the economy.
● The two measures to reduce revenue deficit are:
i. The government should reduce all its unproductive expenditure.
ii. The government should increase its revenue from various tax and nontax revenue sources.
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