Odisha Receives Rs 5,282.62 Crore As Centre Releases Tax Devolution
Bhubaneswar: The Odisha government has received Rs 5,282.62 crore as the Central government released two instalments of tax devolution to different states.
The Centre released two instalments of tax devolution amounting to Rs 1,16,665 crore as against the normal monthly devolution of Rs 58,332.86 crore, an official statement said on Wednesday.
This is in line with the commitment of the Central government to strengthen the financial position of states to accelerate their capital and developmental expenditure. The devolution has been made as part of the exercise for distribution of net proceeds of union taxes and duties for August 2022, sources said.
As per the recommendations of the 15th Finance Commission, 41 per cent of the divisible tax pool is to be devolved to the states, which was given to the states on monthly basis. The two instalments have been released together to step up investment, infrastructure and growth.
The Odisha government earlier stated that with steady increase in cess and surcharge, the growth in divisible pool was not commensurate with the growth of central taxes.
Sources said the finances in Odisha had been affected for quite some time due to decline in Central share – both in grants and devolution of taxes. The Central transfers have been decreasing from 58 per cent in 2016-17 to 48 per ccent in 2020-21. The actual tax devolution was Rs 27,543 crore in 2020-21, the lowest in six years, against the 15th Finance Commission’s recommendation of Rs 39,586 crore, sources said.
Citing a State Finances Audit Report, they said Odisha’s overall revenue receipts were adversely impacted as Central Tax transfer and grants decreased by Rs 2,911 crore and Rs 1,084 crore respectively during 2020-21 over the previous year.
The Budget Estimate (BE) for Central Tax Transfer was Rs 36,300 crore while the actual receipt was only Rs 27,543 crore during 2020-21. Similarly, the BE for grants-in-aid from the Centre was Rs 32,000 crore and the actual receipt was Rs 23,068 crore, they said.
The shortfall in receipt of Central transfer affected the actual revenue receipt of Rs 1,04,387 crore, being lower than the budgeted revenue receipts of Rs 1,24,300 crore by Rs 19,913 crore in 2020-21, they said.