Centre releases extra Rs 1.09 lakh crore tax devolution to states

The Finance Ministry on Saturday (August 1, 2026) announced that the Centre has released an additional instalment of tax devolution worth Rs 1.09 lakh crore to state governments, over and above the normal monthly devolution.

“The Union government has released additional instalment of tax devolution to state governments amounting to Rs 1,09,019 crore on 1st August 2026, which is in addition to the normal monthly devolution to be released on 10th August 2026,” the Ministry said in a statement.

The government said the additional release is aimed at strengthening state finances and accelerating capital and developmental expenditure across states.

Currently, 41 per cent of taxes collected by the Centre is devolved among states in 14 instalments during a fiscal year.

According to the Finance Ministry, the advance release reflects the Centre’s commitment to strengthening state finances, enabling states to accelerate infrastructure development, welfare programmes and other capital expenditure. The government said the funds would help states meet expenditure requirements more efficiently and ensure the timely execution of infrastructure and development projects across the country.

Uttar Pradesh Gets Highest Share

According to the state-wise break-up, Uttar Pradesh received the highest allocation of Rs 19,208 crore, followed by Bihar (Rs 10,845 crore), Madhya Pradesh (Rs 8,010 crore), West Bengal (Rs 7,866 crore) and Maharashtra (Rs 7,022 crore).

Other major allocations included Rajasthan (Rs 6,460 crore), Odisha (Rs 4,819 crore), Andhra Pradesh (Rs 4,597 crore), Karnataka (Rs 4,504 crore), Tamil Nadu (Rs 4,466 crore), Gujarat (Rs 4,094 crore), Jharkhand (Rs 3,660 crore), Chhattisgarh (Rs 3,602 crore) and Assam (Rs 3,552 crore).

Among the remaining states, Kerala received Rs 2,597 crore, Telangana got Rs 2,370 crore, and Punjab was allocated Rs 2,176 crore. Haryana (Rs 1,484 crore), Arunachal Pradesh (Rs 1,476 crore) and Uttarakhand (Rs 1,244 crore) were also among the mid-range allocations.

The smaller states and Union Territories received comparatively modest amounts, with Himachal Pradesh getting Rs 996 crore, Tripura Rs 699 crore, Meghalaya Rs 688 crore, Manipur Rs 682 crore, Mizoram Rs 615 crore, Nagaland Rs 524 crore, Goa Rs 398 crore and Sikkim Rs 365 crore.

Among the Telugu states, Andhra Pradesh received Rs 4,597 crore, while Telangana was allocated Rs 2,370 crore as part of the tax devolution for August 2026.

Chandrababu Naidu Thanks PM Modi and Sitharaman

Andhra Pradesh Chief Minister N Chandrababu Naidu on Sunday thanked Prime Minister Narendra Modi and Union Finance Minister Nirmala Sitharaman for allocating an additional Rs 4,597 crore to the state as its share in central taxes.

The chief minister said the amount had been released along with the regular monthly tax devolution, which is usually transferred to states on the 10th of every month.

“The additional allocation of Rs 4,597 crore as Andhra Pradesh’s share in central taxes, released along with the regular monthly tax devolution, will further accelerate development programmes in the state. On behalf of the people of Andhra Pradesh, I thank PM Modi and Sitharaman for their continued support,” Naidu said in a post on ‘X’.