Centre to transfer extra instalment of taxes to states in June

NEW DELHI: Buoyed by healthy cash flows due to good revenue receipts so far this year, the centre on Monday decided to release an extra instalment of taxes that are transferred to the states.
“This is a goodwill gesture as the tax collections have been good,” said an official, explaining the rationale while ruling out any cash crunch for some of the states.
“It was decided that apart from the regular release of the devolution amount for the month of June 2024, one additional instalment will be released. This cumulatively amounts to Rs 1,39,750 crore in the current month. This will enable state governments to accelerate development and capital spending,” the finance ministry said in a statement.
With this release, so far in the current financial year, the total amount devolved to states was estimated at almost Rs 2.8 lakh crore.
Transfers are in line with the formula and Uttar Pradesh will get over Rs 25,000 crore, followed by Bihar (Rs 14,000 crore), Madhya Pradesh (around Rs 11,000 crore) and West Bengal (Rs 10,513 crore).
In the past, some of the states have complained that funds are either not released by the Centre or not released on time.