A student of economics has recorded certain transactions under revenue receipts. Identify the incorrect item recorded by her, if any :

Value of goods produced by government undertakings

The correct answer is option (2) : Value of goods produced by government undertakings

The value of goods produced by government undertakings is considered a part of the government's production and falls under the category of revenue from the sale of goods and services. It is not a revenue receipt in the traditional sense because it involves a sale transaction rather than an inflow of funds without a corresponding obligation.

Revenue Receipts: Revenue receipts are those receipts that do not lead to a claim on the government. They are therefore termed non-redeemable. They are divided into tax and non-tax revenues. Tax revenues, an important component of revenue receipts, have for long been divided into direct taxes (personal income tax) and firms (corporation tax), and indirect taxes like excise taxes (duties levied on goods produced within the country), customs duties (taxes imposed on goods imported into and exported out of India) and service tax1 . Other direct taxes like wealth tax, gift tax and estate duty (now abolished) have never brought in large amount of revenue and thus have been referred to as ‘paper taxes’. Non-tax revenue of the central government mainly consists of interest receipts on account of loans by the central government, dividends and profits on investments made by the government, fees and other receipts for services rendered by the government. Cash grants-in-aid from foreign countries and international organisations are also included.