Ahead of festive season, Centre releases over Rs 1.78 lakh crore to states towards tax devolution
As per the statement, this tax devolution includes one advance installment, in addition to the regular installment due in October 2024. The decision was taken in view of the upcoming festive season and to enable States to accelerate capital spending, and also finance their development/welfare-related expenditure, as per the statement.
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NEW DELHI: Ahead of festive season, the central government has released over Rs 1.78 lakh crore to the states as devolution of its tax revenue, against the normal monthly devolution of Rs 89,086.50 crore, the Finance Ministry said on Thursday.
As per the statement, this tax devolution includes one advance installment, in addition to the regular installment due in October 2024. The decision was taken in view of the upcoming festive season and to enable States to accelerate capital spending, and also finance their development/welfare-related expenditure, as per the statement.
The biggest chunk of the fund went to Uttar Pradesh at Rs 31,962 crore, followed by Bihar at Rs 17,921 crore, Madhya Pradesh got Rs 13,987 crore, and West Bengal at Rs 13,404 crore. This disbursement highlights the central government's focus on maintaining a steady flow of financial resources to states, ensuring they have the means to undertake crucial development initiatives.
The Ministry's decision follows a high-level meeting with the Finance Secretary and the Secretary of the Department of Economic Affairs. State governments will benefit from this enhanced financial support, enabling them to accelerate their capital expenditures, including critical infrastructure projects such as road construction, public facilities, and other development initiatives.
The Finance Ministry has provided a detailed state-wise breakdown of the funds released, ensuring each state receives its fair share to meet its specific development needs. Among the states, Andhra Pradesh got Rs 7,211 crore, Gujarat received Rs 6,197 crore, and Tamil Nadu received Rs 7,268 crore.
Among the Northeast states, Meghalaya received Rs 1,367 crore, Tripura got Rs 1,261 crore, and Manipur got Rs 1,276 crore. As India continues to navigate the complexities of global economic dynamics, the central government's focus on providing financial support to states is crucial for sustaining growth and fostering development of the country.
Devolution of taxes is the process of distributing the net proceeds of taxes between the Union and the states in India. The Finance Commission makes recommendations on how to distribute the taxes between the Union and the states, as well as among the states. The state's share of the taxes is released based on the recommendations of the Finance Commission.