Extra Funds For States
Key Highlights
- Centre released an additional ₹1.09 lakh crore to states.
- Amount is over and above the regular monthly tax devolution.
- Normal monthly instalment will be released on August 10.
- States receive 41% of the Centre’s tax collections.
- Additional funds aim to strengthen state finances and expenditure.
New Delhi, Aug 1: The Central Government has released an additional ₹1.09 lakh crore as tax devolution to state governments, providing a significant financial boost ahead of the regular monthly transfer scheduled for August 10.
According to the Ministry of Finance, the additional instalment was released on August 1, 2026, and is separate from the normal monthly devolution that states receive under the existing fiscal sharing mechanism.
Under the current tax devolution framework, 41% of the taxes collected by the Centre are distributed among states through 14 instalments during a financial year, helping them meet development, infrastructure and welfare expenditure.
The Finance Ministry said the additional release is intended to strengthen the financial position of state governments, enabling them to accelerate public spending and implement various development programmes more effectively.
The regular monthly tax devolution for August will continue as scheduled and will be released on August 10, 2026, in addition to the special allocation announced on Saturday.
The move is expected to improve liquidity for state governments and support ongoing infrastructure projects, social welfare schemes and other public expenditure commitments.
