New Delhi [India], January 10 : The Union Government has released tax devolution of Rs 1,73,030 crore to State Governments today, as against the devolution of Rs 89,086 crore in December 2024.
A higher amount is being devolved this month to enable states to accelerate capital spending and finance their development and welfare-related expenditures.
Tax devolution refers to the distribution of tax revenues between the central government and the state governments. It is a constitutional mechanism to allocate the proceeds of certain taxes among the Union and the states in a fair and equitable manner. Finance Commission recommends the division of net proceeds of taxes between the union and the states
Uttar Pradesh got the highest amount of Rs 31,039.84 crore, followed by Rs 17,403.36 crore to Bihar and Rs 13017.06 crore to West Bengal.
Maharashtra is given Rs 10.930.31 crore while Rajasthan received Rs 10,426.78 crore.
Goa and Sikkim got the smallest amount of Rs 667.91 crore and Rs 671.35 crore respectively.
The share of states in the central taxes for the 2021 to 2026 period is recommended to be 41 per cent, same as that for 2020-21. This is less than the 42 per cent share recommended by the 14th Finance Commission for 2015-20 period. The adjustment of 1 per cent was made to provide for the newly formed union territories of Jammu and Kashmir, and Ladakh from the resources of the centre.
For devolution amount to individual states, 12.5 per cent weightage is given to the demographic performance, 45 per cent to income, 15 per cent each to population and area, 10 per cent to forest and ecology and 2.5 per cent to tax and fiscal efforts.
Disclaimer: This post has been auto-published from an agency feed without any modifications to the text and has not been reviewed by an editor