Center Releases Additional ₹72,961 Crore in Tax Devolution to States
Continuing its commitment to empower state governments, the central government has disbursed an additional instalment of Rs 72,961.21 crore as tax devolution to states on December 22, 2023. This comes as a follow-up to a similar transfer earlier in the month on December 11, according to an official statement from the finance ministry.
In anticipation of upcoming festivities and the New Year, the Union Government has authorized this extra release to bolster the financial capacities of state governments. The funds are earmarked for financing a range of social welfare measures and infrastructure development schemes.
With the recent transfer, the cumulative amount transferred to states in December stands at an impressive Rs 1.46 lakh crore. This marks the second double instalment of tax devolution for the fiscal year 2023-24, following a similar allocation in June.
Uttar Pradesh leads the states in receiving the largest share, accounting for Rs 13,089 crore, followed by Bihar at Rs 7,338 crore. The distribution of funds among states is determined by various factors, including population.
The 2023-24 Budget outlines the Centre’s plan to transfer Rs 10.21 lakh crore to states. Although the scheduled size of each of the 14 instalments is Rs 72,961 crore, adjustments may occur based on improved revenue projections. The finance ministry, in its December 22 statement, announced another instalment scheduled for January 10, 2024, without specifying its size.
Q: Why did the central government release an additional Rs 72,961.21 crore to states in December?
A: The release aims to strengthen state governments for social welfare measures and infrastructure development during the festive season and the New Year.
Q: Which states received the highest amounts in this tax devolution?
A: Uttar Pradesh received the largest share at Rs 13,089 crore, followed by Bihar at Rs 7,338 crore.
Q: How does the central government determine the distribution of funds among states?
A: The distribution is based on various factors, including population.
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