According to a recent report, robust tax collections, particularly from GST and Central transfers, are expected to boost the revenue of larger states by 8-10 percent this fiscal year.

The report indicates that the top 18 states, contributing over 90 percent of the gross state domestic product, will see their revenue grow by 8-10 percent, reaching Rs 38 trillion this fiscal year. Last year, the growth rate was 7.5 percent, as per Crisil Ratings.

This growth will be mainly driven by healthy GST collections and devolution from the Centre, which together constitute 50 percent of the total state revenue.

Revenue from liquor sales taxes, which account for 10 percent of total revenue, is expected to remain stable. Meanwhile, sales tax collection from petroleum products, contributing 7-8 percent of revenue, and grants recommended by the 15th Finance Commission, making up 10-11 percent, are projected to see modest mid-single-digit growth, according to the report.