"A government budget is an annual financial statement showing estimated receipts and estimated expenditure of the government during a fiscal year."
Components of the budget : The budget is divided into two main parts :

(i) Revenue Budget
(ii) Capital Budget (i) Revenue Budget : It comprises of current revenue receipts and current revenue expenditures met from such revenues. It includes the following components :
(a) Revenue Receipt : It includes tax revenue and non-tax revenue.
(1) Tax Revenue : Tax revenue consist of proceeds of taxes and other duties levied by the union government. It may be direct or indirect taxes.
Direct tax: When liability to pay a tax and the burden of that tax falls on the same person. The tax is called a direct tax. For e.g. income tax, corporate tax etc.
Indirect Tax: When liability to pay a tax is on one person and the burden of that tax falls on some other person, the tax is called an indirect tax. For e.g. custom duty, excise duty etc.
(2) Non-tax Revenue : Income from sources other than taxes is called non-tax revenue. For e.g. interest, fees and fine, grant in aid etc.
(b) Revenue Expenditure : An expenditure which neither creates assets nor reduces liability is called revenue expenditure. For e.g. salaries of employees, interest, payment on past debt, subsidies etc.
(ii) Capital Budget : It comprises of current capital receipts and current capital expenditures which are described as :
(a) Capital Receipt: Government receipts which either create liabilities or reduces assets are called capital receipts. For exampleborrowings, raising of funds from PPF and small saving deposits.
(b) Capital Expenditure: An expenditure which either creates an asset or reduces a liability is called capital expenditure. This type of expenditure adds to the capital stock of the economy and raises its capacity to produce more in future.