Centre Boosts State Economies with Over ₹1.09 Lakh Crore Tax Devolution

In a significant move to support state economies, the central government has announced an additional tax devolution installment of over ₹1.09 lakh crore. Finance Minister Nirmala Sitharaman highlighted that this funding is driven by strong economic performance and tax collections. The release aims to enhance infrastructure development and welfare programs, especially with the festive season approaching. This installment is part of the regular monthly devolution, ensuring that states have the necessary resources to accelerate capital spending and support their development initiatives. Discover more about how this financial boost will impact states across India.

By Narendra Chaudhary Oct 31, 2026, 22:44 IST

Significant Financial Support for States

New Delhi: On Saturday, the central government announced the release of an additional tax devolution installment exceeding ₹1.09 lakh crore to state governments.

Finance Minister Nirmala Sitharaman shared on X that this second additional installment for the current financial year is a result of robust economic activity and strong tax revenues.

Sitharaman emphasized that this funding will enable states to enhance infrastructure projects, support welfare initiatives, and stimulate economic growth throughout India.

This amount is supplementary to the regular monthly devolution and the previously mentioned second additional installment for this fiscal year.

According to a statement from the finance ministry, the Union government has allocated ₹1,09,019 crore in tax devolution to the states.

The ministry noted that this release is timed with the festive season, allowing states to boost capital expenditures and fund their development and welfare-related activities.

Currently, 41% of the taxes collected by the central government are distributed among states in 14 installments throughout the fiscal year.