---
title: "Net Tax Revenue: Definition & Devolution | Model Diplomat"
description: "Net tax revenue is a government's gross tax collection minus refunds and transfers, crucial for India's Finance Commission and fiscal policy."
url: "https://modeldiplomat.com/learn/glossary/net-tax-revenue"
---

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Model Diplomat Research Team · Last reviewed June 22, 2026

TL;DR

- Net tax revenue is the gross tax collection of a government after deducting refunds and the share transferred to other tiers of government under constitutional or statutory devolution arrangements.
- How does net tax revenue differ from gross tax revenue in the Indian Budget?
- Why are cesses and surcharges excluded from the divisible pool?
- What percentage of the divisible pool do States currently receive?
- How did GST change the calculation of net tax revenue?

[Civil Service & Diplomatic Exams](https://modeldiplomat.com/learn/civil-services/glossary)Updated June 22, 2026

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Finance Minister Nirmala Sitharaman's Union Budget 2023–24, presented on 1 February 2023, reported net tax revenue to the Centre after devolving 41 percent of the divisible pool to States per the Fifteenth Finance Commission.

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