Centre adds ₹1.09 lakh crore tax devolution to states ahead of festive season

Centre releases an additional tax devolution of ₹1,09,019 crore to state governments on 31 October 2026. The payment joins the regular monthly transfers and follows a second extra instalment earlier this fiscal year. The Finance Ministry said the move is to help states speed up capital spending ahead of the festive season and to fund development and welfare programmes. Currently 41% of central tax revenue is shared with states, spread over 14 instalments each year.

Context

The devolution system allocates a fixed share of central taxes to states to support their budgets. These periodic transfers let states plan projects and meet seasonal demand for services.