Centre Releases Rs 1.01 Lakh Crore Advance Tax Devolution To States Ahead Of Festive Season

In a major fiscal push ahead of the festive season, the Union Government on Wednesday (October 1) released an advance instalment of Rs 1,01,603 crore in tax devolution to state governments, as per an official press release.

The move is intended to provide states with additional financial flexibility to step up capital expenditure, welfare initiatives, and development projects.

This advance release is over and above the regular monthly devolution, which is scheduled for 10 October, emphasising the Centre’s bid to ease fiscal pressures and enable faster project execution at the state level.

According to the Finance Ministry, the allocation includes the largest share of Rs 18,227 crore to Uttar Pradesh, followed by Rs 10,219 crore to Bihar, Rs 7,976 crore to Madhya Pradesh, Rs 7,644 crore to West Bengal, and Rs 6,418 crore to Maharashtra.

Other significant beneficiaries include Rajasthan (Rs 6,123 crore), Odisha (Rs 4,601 crore), Tamil Nadu (Rs 4,144 crore), Andhra Pradesh (Rs 4,112 crore), and Karnataka (Rs 3,705 crore).

Smaller states have also been covered in this round of devolution. Himachal Pradesh received Rs 843 crore, while Manipur (Rs 727 crore), Tripura (Rs 719 crore), and Sikkim (Rs 394 crore) were allocated funds to bolster their fiscal capacity.

Among the northeastern states, Mizoram was given Rs 508 crore, Nagaland Rs 578 crore, and Meghalaya Rs 779 crore. Goa received Rs 392 crore under the advance release.

The Centre stressed that the measure will assist states in meeting immediate expenditure commitments, particularly in financing infrastructure outlays and welfare schemes.

Analysts suggest that this pre-festive infusion could help states ramp up public spending, thereby supporting broader economic activity.

The latest release also comes against the backdrop of the government’s plans to borrow Rs 6.77 lakh crore in the second half of FY26, including Rs 10,000 crore through Sovereign Green Bonds, signalling its balancing act between fiscal discipline and growth priorities.

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