Northeastern States Witness Substantial Tax Devolution Boost

With the advent of Prime Minister Narendra Modi’s third term, the Northeastern states have received a significant financial impetus through the disbursement of tax devolution installments. Assam, as the largest state in the region, leads the cohort, securing the highest allocation of Rs 4,371.38 crore from the Finance Ministry’s announcement to release Rs 1,39,750 crore as part of the tax devolution for states across the country.

Following closely, Arunachal Pradesh secures the second-highest amount in the Northeast, receiving Rs 2,455.44 crore, highlighting the pressing development needs of the region. Surpassing expectations, Meghalaya emerges as the third-highest recipient among Northeastern states, securing Rs 1,071.90 crore, outstripping even the traditionally tourism-focused state of Sikkim, which receives Rs 542.22 crore.

Other states in the region also benefit substantially, with Manipur receiving Rs 1,000.60 crore, Tripura Rs 989.44 crore, Nagaland Rs 795.20 crore, and Mizoram Rs 698.78 crore.

This significant release of funds through tax devolution is poised to empower state governments to expedite development and capital spending, effectively addressing regional infrastructure and developmental requirements.

On a national scale, Uttar Pradesh leads with the highest allocation of Rs 25,069.88 crore, followed by Bihar with Rs 14,056.12 crore and Madhya Pradesh with Rs 10,970.44 crore.

The Interim Budget 2024-25 had earmarked Rs 12,19,783 crore towards the devolution of taxes to states. With this recent release, the total amount devolved to states for the fiscal year 2024-25 reaches Rs 2,79,500 crore as of June 10, 2024, promising enhanced fiscal resources for states to drive development initiatives.