1. Source of Revenue for Central Government
Source of Tax Revenue for Central Government:
It includes taxes on certain items mentioned in the Union List of the seventh schedule and others.
Source of Non Tax Revenue for Central Government:
- Income of government undertaking
- Income for government properties
- Interest earning on loans and advances
- Gifts, donations, grants and aid, etc.
- Fees (excluding court fees other than the supreme Court.
2. Source of Revenue for State Government
Source of Tax Revenue for State Government:
Taxes on the items contained in the State List of the seventh Schedule of the Constitution which includes land revenue, taxes on agriculture income, sales tax, etc.
Source of Non Tax Revenue for Sate Government:
- Fee taken in all courses except Supreme Court
- Income of government undertakings
- Income from State owned property
- Royalty from mines, forests, etc.
- Grants in Aid.
(ii) Article 293 of the Indian constitution mandates the States to obtain the consent of the Centre for borrowing if they are already indebted to the Centre.