New Delhi: Union Finance Minister Nirmala Sitharaman has firmly dismissed Opposition allegations of a reduction in states’ share of tax revenue, assuring the Lok Sabha that the Centre remains fully committed to the Finance Commission’s recommendations. Replying to the Budget 2026–27 discussion, she stated that a substantial ₹25.44 lakh crore is estimated to be transferred to states in the upcoming financial year through tax devolution and other allocations — marking a significant increase over the previous year. Emphasising that 41% of the divisible tax pool continues to be devolved to states as mandated, Sitharaman clarified that there has been no cut in any state’s entitlement. She also noted that cess and surcharge collections, which fall outside the divisible pool, are levied under constitutional provisions for developmental purposes. The Finance Minister’s remarks aim to reinforce the Centre’s commitment to cooperative federalism and financial support to states amid ongoing political debate.
