Tax devolution: Centre releases third instalment of Rs 1.18L cr to states in June
The first two installments were released in April and May 2023. The transfer is part of the routine devolution from the Centre’s divisible pool of taxes.
NEW DELHI: The Union government has released the third instalment of tax devolution to state governments amounting to Rs 1,18,280 crore on June 12, 2023, as against the normal monthly devolution of Rs 59,140 crore.
“One advance instalment in addition to the regular instalment due in June 2023 is being released to states to enable them to speed up capital spending, finance their development/ welfare related expenditure and also to make available resources for priority projects/ schemes,” the finance ministry said in a statement.
Uttar Pradesh received the highest Rs 21,218 crore followed by Bihar (Rs 11,897 crore), Madhya Pradesh (Rs 9,285 crore), West Bengal (Rs 8,898 crore) and Rajasthan (Rs 7,128 crore).
The first two installments were released in April and May 2023. The transfer is part of the routine devolution from the Centre’s divisible pool of taxes. As per the 15th Finance Commission, the Centre has to transfer 41% of funds from the divisible pool of taxes, which excludes revenue collected through cess and surcharges. In FY23, the states received Rs 9.5 lakh crore as part of tax devolution from the Centre.
Meanwhile, the government has approved Rs 29,500 crore for capex expenditure to states. This is part of the Rs 1.3 lakh crore allocated for special assistance to states for capital expenditure. The government also released a sum of Rs 13,078 crore in May as part of post-devolution revenue deficit grant, grants for urban and rural local bodies, etc.
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