Centre releases Rs 1.78 lakh cr tax devolution to states, including advance instalment for festive season

This release is in view of the upcoming festive season

In a significant move ahead of the festive season, the Union Government has released Rs 1,78,173 crore to state governments as tax devolution. This release includes an advance instalment of Rs 89,086.50 crore, in addition to the regular instalment due in October.

"This release is in view of the upcoming festive season and to enable states to accelerate capital spending, and also finance their welfare related expenditure," the government said in a statement on October 10, explaining the rationale behind the advance release.

Typically, tax devolution is carried out on a monthly basis, with Rs 89,086.50 crore being the regular instalment for October. However, the Union Government has doubled the release to help states manage their finances more effectively during the festive period.

The advance instalment is expected to provide a timely boost to capital spending and welfare initiatives across states, ensuring they have the necessary resources to accelerate development activities during this crucial period, it said.