Centre transfers additional Rs 72,961 crore to states above budgeted tax devolution
additional installment of tax Devolution to States on Friday up and above the regular 14 installments released to the states on the basis of recommendation by the Finance Commission..
This is in addition to tax devolution due to States on 10 January 2024 and the installment of Rs 72,961.21 crore already released on 11 December 2023, the finance ministry specified in a statement released Friday.
It added that the additional fund is released to the states in view of the forthcoming festivities and the New Year.
«In view of the forthcoming festivities and the New Year, the Union Government has authorised the release of an additional installment of tax devolution amounting to ₹72,961.21 crore to strengthen the hands of State Governments for financing various social welfare measures and infrastructure development schemes,» Finance Ministry said.
Generally the centre releases funds under tax devolution to states on 10th of each month.
However in the past two years it had been releasing advances to facilitate states in their fight against covid and also to help push capital spending.
The devolution states get from the centre is used for spending on development, welfare and priority-sector projects and schemes.
As per the recommendation of the 15th finance commission, currently, 41% of taxes collected by the Centre is devolved in 14 instalments among states during a fiscal year.
States have set a capex target of Rs 8.27 lakh crore for the current fiscal year out of which it has spent Rs.3.24 lakh crore so far, roughly 40% of the target by the end of October.
