Centre Releases Advance Tax Devolution of ₹1,01,603 Crore to States Ahead of Festive Season

On October 1, 2025, the Union Government announced the release of an advance tax devolution of ₹1,01,603 crore to various state governments. This timely support is expected to enable states to ramp up capital expenditure and welfare-related spending ahead of the festive season.

Immediate Allocation for Capital and Welfare Expenditure

The advance release is in addition to the scheduled monthly tax devolution due on October 10, 2025. This strategic step is designed to ensure seamless implementation of social welfare programmes and infrastructure initiatives during a critical economic period.

The allocation enables states to plan and execute spending without delays, especially when consumer activity and public service delivery peak.

Top Recipients: Major Funding to High-Population States

The distribution of this ₹1,01,603 crore includes ₹18,227 crore for Uttar Pradesh, ₹10,219 crore for Bihar, ₹7,976 crore for Madhya Pradesh, ₹7,644 crore for West Bengal, and ₹6,418 crore for Maharashtra. These states will have significant capacity enhancement for handling public projects, compensations and development initiatives.

Support for Medium and Smaller States

Other sizable allocations include ₹6,123 crore to Rajasthan, ₹4,601 crore to Odisha, ₹4,144 crore to Tamil Nadu, ₹4,112 crore to Andhra Pradesh, and ₹3,705 crore to Karnataka. Even smaller states like Himachal Pradesh (₹843 crore), Manipur (₹727 crore), and Tripura (₹719 crore) benefit from this windfall.

Read More: ITR Refund for FY25: Wrong Tax Deduction Claims Can Cost You 5x More!

North-Eastern and Hill States Not Left Behind

Sikkim received ₹394 crore, Mizoram ₹508 crore, Nagaland ₹578 crore, and Meghalaya ₹779 crore, ensuring inclusive fiscal dispersal. Goa also received a notable ₹392 crore. Such allocations reflect a balanced strategy to promote regional development, especially in remote and border areas, aiding administrative outreach and festive preparations.

Conclusion

This ₹1,01,603 crore advance tax devolution will enable both large and small states to meet immediate financial needs, accelerate public works, and reinforce welfare frameworks just ahead of the festive season. The early release showcases proactive fiscal planning by the Centre amid seasonal demand and governance imperatives.

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