This is in addition to the regular monthly instalment of the same amount, scheduled for release on June 10, 2025.
The additional instalment will enable states to speed up their capital spending, finance their development and welfare-related expenditure, and make available resources for priority projects and schemes, the finance ministry said in a social media post on X on Friday. The move will provide a much-needed stimulus to the economy, as state capital spending has a multiplier effect on driving economic growth.
“The additional instalment of devolution to states is in line with the principle of co-operative federalism and the aim of becoming ‘Viksit Bharat’ by 2047,” the ministry said.
Currently, 41% of taxes collected by the Centre are devolved in instalments to states during a fiscal year. For the first month of the current fiscal, the Centre received ₹1.89 lakh crore net tax revenue, Rs 67,160 crore of non-tax revenue, and ₹22,459 crore of non-debt capital receipts, on account of recovery of loans, official data showed.
According to the Controller General of Accounts data, released earlier in the day, ₹12.86 lakh crore was transferred to state governments as a devolution of share of taxes by the government up to March 2025, which is ₹1,57,391 crore higher than the previous year. For FY26, tax devolution to states is estimated at ₹14.22 lakh crore.
Content Source: economictimes.indiatimes.com