Staff Reporter
GUWAHATI: The Assam government is going to receive around Rs 4,000 crore more as a share of central taxes in the financial year 2025-26, compared to the financial year 2024-25.
The bulk of the budget outlay comes from the share of central taxes. The estimated budget outlay for 2024-25 was Rs 1,43,605 crore. Of this amount, 27.85 percent, i.e., Rs 40,253 crore, came from the share of central taxes. On the contrary, Rs 44,494 crore will come from the share of central taxes in 2025-26.
The share in central taxes is the portion of taxes collected by the central government that is distributed to the state governments in a certain ratio. The Finance Commission devises the formula to be followed in the calculation of the central tax share of each state.
In September 2024, the Chief Minister requested the Chairman of the 16th Finance Commission (FC) to increase the share of central taxes for Assam during the visit of an FC team to the state.
According to official sources, the share of central taxes plays an important role in different ways for a state. It helps strengthen the financial autonomy of the state government, it promotes fiscal federalism, the share of central taxes helps states meet the needs of their population, etc.
The Chief Minister urged the 16th Finance Commission to increase Assam's inter-se share within the framework of horizontal devaluation and consider treating the Northeast as a collective block by allocating 10 percent of central funds to the northeastern states.
The Chief Minister also highlighted to the Finance Commission the unique challenges and costs faced by Assam, such as its diverse geography, the impact of climate change, multiple international borders, and the looming threat of demographic shifts. Despite these challenges, the state government managed to achieve higher capital expenditure and demonstrated performance across critical sectors.
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