Panaji: Goa has received ₹667.91 crore as part of tax devolution, following the central government’s release of ₹1,73,030 crore to states on Friday. This marks a significant increase compared to the ₹89,086 crore devolved in December 2024.
The higher allocation aims to enable states to enhance capital spending and support their development and welfare-related expenditures.
Tax devolution is the constitutional process of distributing tax revenues between central and state governments, based on recommendations from the Finance Commission. This body ensures that allocations are conducted fairly and equitably.
For the 2021-2026 period, the Finance Commission has recommended maintaining the states' share of central taxes at 41 percent, consistent with the 2020-21 ratio. This represents a reduction from the 42 percent share recommended by the 14th Finance Commission for 2015-2020, which accounted for the creation of the Union territories of Jammu and Kashmir and Ladakh.
The Finance Commission employs specific criteria to determine devolution amounts for each state, including 12.5 percent weightage for demographic performance, 45 percent for income, 15 percent each for population and area, 10 percent for forest and ecology, and 2.5 percent for tax and fiscal efforts.