Centre Not Hostile To Tamil Nadu On Funds Flow, Says Nirmala Sitharaman

The Centre was never hostile towards Tamil Nadu, Kerala or any other state on ensuring funds flow and had made advance payments and even released funds to foster infrastructure development, Union Finance Minister Nirmala Sitharaman said on Thursday.

Responding to a criticism from the DMK government that the central government was not disbursing funds or settling its share, she said from 2014 to 2023 the Centre received Rs 6.23 lakh crore as direct tax (income tax and corporate tax) from Tamil Nadu but gave back Rs 6.96 lakh crore to the state during the same period.

"I will get the update on the current figures only in March. But as per the available statistics, from 2014 till 2022-23, Tamil Nadu's direct tax collection was Rs 6.23 lakh crore. But we gave Rs 6.96 lakh crore to the state," she said while speaking at the Viksit Bharat Sankalp Yatra programme here.

"It is a wrong assumption that this Rs 6.23 lakh crore is paid only by the people of Tamil Nadu. Among them were Hindi-speaking tax assessees," the Finance Minister said.

She had to put the record straight as there has been a misinformation campaign that the BJP-led union government was not prompt in releasing funds to states.

"You are asking to give back your tax money. The Central government has been giving back the Cess, tax or even the GST collected from TN and in addition providing additional funds," Sitharaman said.

Post-Covid, going beyond the Finance Commission's recommendations, Prime Minister Narendra Modi had asked her Ministry to provide special capital assistance to the states to foster their infrastructure development, she noted.

The Modi government has settled dues amounting to about Rs 81,645 crore pending since 1996-97 to all states and Tamil Nadu's share in it was Rs 3,225 crore.

The money obtained as cess and surcharge were also given back to the state for the construction of schools and roads, Pradhan Mantri Awas Yojana (Rural) and Gram Sadak Yojana. About Rs 57,557 crore was obtained by way of cess and surcharge from Tamil Nadu from 2014 till date. Of the sum, Rs 37,965 crore was disbursed to construct NHAI roads, Rs 11,116 crore from education cess for Samagra shiksha overarching programme for school education, Rs 4,839 crore for PMAY, Rs 3,637 crore for the rural roads scheme in the state.

Of the Rs 36,353.12 crore collected as GST from Tamil Nadu in 2022-23, the Centre released the entire sum to the state and in addition provided 41 percent from the Rs 27,360 crore CGST collection. "We have given the GST entirely to the state governments without discrimination," she added.

"You are blaming the Centre is not giving funds. The Finance Commission decides on the sum to be given to each state. The Centre is not hostile to Tamil Nadu, Kerala or any state and does not retain the sum due for them. The amount is disbursed on a monthly basis and in certain cases, advance payment is made during festivals," she said.

As the Minister concluded her speech, a woman who had come to attend the function, sought to know if she would get the flood relief sum. Immediately Sitharaman replied "you will get it. We will look into your case if you provide us the details."

The Finance Minister handed over cheques to beneficiaries under various central government schemes such as Mudra Yojana, Stand up India, and PM SVANidhi, at the event.