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Centre doubles tax devolution amount for states in November

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With this, states will have more money in their hands so that they can consider spending it for infrastructure creation, FInance Minister Nirmala Sitharaman said.

Centre doubles tax devolution amount for states in November
Finance Minister Nirmala Sitharaman on Monday said the government will release Rs 95,082 crore as tax devolution to the states in November, after including one advance instalment to help them push their capital expenditure,
"I have suggested the Finance Secretary that on November 22 instead of normal Rs 47,541 crore, the states be given one more instalment. So, Rs 95,082 crore will be given to them instead," she said.
The decision was taken after her meeting with all chief ministers and state finance ministers.
With this, states will have more money in their hands so that they can consider spending it for infrastructure creation, the finance minister said, adding that states had said it would be helpful for them if the tax devolution is front loaded.
We're seeing robust growth after second wave of COVID-19. However it's also the time we're looking at ways to sustain growth and take it to double digits, she said explaining the context of the meeting.
Currently, 41 percent of tax collected is devolved in 14 instalments and states have a predictability of their cash flows, Finance Secretary T V Somanathan said. This is an advance release, and any adjustments will be made in March, he added.
Sitharaman also said that the recently launched National Monetisation Pipeline includes only central government assets and state assets have been out of its purview as of now.
She suggested that there is a significant potentially monetizable asset base in states which could be leveraged to enhance the capital available for new infrastructure creation and other social sector pressing priorities, an official statement issued after the meeting said.
"Sitharaman urged states to help India become the fastest growing economy in coming years, through facilitating investment attractiveness and expediting ease of doing business measures and undertake power reforms," the statement added.
(With inputs from PTI)
 
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