Rs 6045 Crore for North Chennai in Tamil Nadu Budget
Along with the Budget, an exclusive Agriculture Budget was also presented by Agriculture Minister M R K Paneerselvam.
Chennai: An allocation of Rs 12,359 crore for crop loan waiver in cooperative banks, Rs 6045 crore for north Chennai, Rs 285 crore for setting up museums, Rs 219 crore for the Information Technology and Digital Services department are some of the highlights of the State’s interim budget with a tax revenue estimate of Rs 229,579 crore, for 2026-27, which was presented by the State Finance Minister Thangam Thennarasu in the State Assembly on Tuesday.
Along with the Budget, an exclusive Agriculture Budget was also presented by Agriculture Minister M R K Paneerselvam. However, the interim Budgets presented in the election year did not have any major announcements of financial commitments that could be made only by the next elected government.
Since the State Government is required to place a Medium Term Fiscal Plan (MTFP) before the House y along with the Budget in accordance with Section 3(1) of the Tamil Nadu Fiscal Responsibility Act, 2003 (TNFRA), a MTFP for the period from 2026-27 to 2028-29 was placed.
Economic scenario Tamil Nadu continued to serve as a major growth engine, supported by a strong manufacturing foundation, swift growth in the services sector, and consistent investments from both the public and private sectors, it said.
The State stands as a national leader in export preparedness, electronics and automobile manufacturing and exports, start-up ecosystem, women’s participation in factory employment, and higher education excellence with the highest Gross Enrolment Ratio and 17 institutions out of the top 100.
With these strong economic drivers in place, Tamil Nadu’s nominal GSDP is expected to grow at 14.50 per cent in 2025-26, with real growth projected at 9 per cent and an average inflation of 5.5 per cent. Going forward, Tamil Nadu’s GSDP growth is projected at 14 per cent per annum for 2027-28 and 2028-29.
The Total Revenue Receipts of the State Government, including the Central Transfers, were estimated to be Rs 3,44,575.31 crore as against the Revised Estimates of Rs.3,09,697.92 crore in 2025-26. The projections for 2027-28 is estimated to be Rs 3,86,448.89 crore and for 2028-29 is Rs 4,34,287.05 crore, which indicates a growth of 12.15 per cent and 12.38 per cent respectively.
The State’s Own Tax Revenue (SOTR), which is estimated to be Rs 2,06,540.36 crore in the Revised Estimates for 2025-26 are likely to increase to Rs 2,29,579.12 crore taking into account both the positive impact of improved economic activity on account of trade deals with the United States of America and European Union, and the adverse impact of the GST rate rationalization exercise done.
The SOTR is projected to be Rs 2,61,720.20 crore in 2027-28 and Rs.2,98,361.02 crore in 2028-29. The growth rates of State’s Own Tax Revenue are estimated to be 14 per cent in 2027-28 and 2028-29.
The State’s Own Non-Tax Revenue has been estimated at Rs 27,703.87 crore. In line with the past trends, the State’s Non-Tax Revenue is projected at Rs 29,920.18 crore in 2027-28 and Rs.32,313.79 crore in 2028-29, reflecting a growth of 8 per cent annually.
Share in Central Taxes is estimated at Rs 62,530.65 crore as against Rs 56,819.23 crore in the Revised Estimates of 2025-26, which is based on the estimates in the Union Budget 2026-27. The share in Central Taxes is projected to be Rs 71,284.94 crore in 2027-28 and Rs 81,264.83 crore in 2028-29 by assuming a growth rate of 14 percent annually.
The Grants-in-Aid from the Union Government are estimated, anticipating the release of entire funds due under Samagra Shiksha scheme, at Rs 24,761.66 crore. For 2027-28 Rs 23,523.58 crore and for 2028-29, Grants-in-Aid are projected at Rs.22,347.40 crore, anticipating a reduction in fund release post the introduction of new payment mechanisms like SNA-SPARSH System for Centrally Sponsored Schemes.
The Revenue expenditure is projected to be Rs 4,29,413.50 crore in 2027-28 and Rs 4,69,402.37 crore in 2028-29. The expenditure under salaries is expected to be Rs 1,04,759.09 crore in 2027-28 and Rs 1,16,282.59 crore in 2028-29 based on anticipated new recruitments.
The Non-wage Operations and Maintenance is estimated to be Rs 18,735.42 crore in the Interim Budget Estimates 2026-27 and projected at Rs 20,234.25 crore in 2027-28 and Rs 21,852.99 crore in 2028-29, reflecting a nominal growth of 8 per cent.
The expenditure on account of Subsidies and Transfers is estimated to be Rs 1,56,108.41 crore in the Interim Budget Estimates 2026-27 and is projected at Rs 1,63,913.83 crore in 2027-28 and Rs 1,72,109.52 crore in 2028-29, reflecting a growth of 5 per cent.
The interest payments for public debt raised in the previous years are a committed liability of the Government and continue to increase every year. It is estimated at Rs 78,677.29 crore in the Interim Budget Estimates 2026-27 and projected at Rs 89,692.11 crore in 2027-28 and Rs 1,02,249.00 crore in 2028-29.
