“This erosion is not due to any structural weakness in the economy but due to administrative decline and systemic leakages across Commercial Taxes, State Excise, Stamps and Registration and Mining,” State Finance Minister N Marie Wilson said in his budget speech.
Anticipating plugging of leakages in liquor retail vending, mining, registration, revenue augmentation and better administration, the projection of SOTR is Rs.2,58,483 crore in 2027-28 and Rs.2,94,671 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, he said.
The State’s Own Non-Tax Revenue is estimated at Rs.27,835 crore in the Revised Budget Estimates for 2026-27 which is a marginal increase over the Interim Budget Estimates of Rs.27,704 crore. It is projected to grow 8 per cent in the years 2027-2028 and 2028-2029.
Tamil Nadu’s share in Central Taxes is estimated at Rs.62,531 crore in Revised Budget Estimates 2026-27, in line with the Interim Budget Estimates.
The Grants-in-aid from the Union Government is estimated at Rs.32,922 crore in Revised Budget Estimates 2026-27. This has been increased from the estimates in the Interim Budget Estimates 2026-27 of Rs.24,762 crore anticipating release from the Union Government for the newly introduced Viksit Bharat-Guarantee for Rozgar and Ajeevika Mission (Gramin) Scheme and the arrear grants-in-aid due to be released to Tamil Nadu under the erstwhile Mahatma Gandhi National Rural Employment Guarantee Scheme.
The Revenue expenditure is estimated at Rs.4,05,802 crore in Revised Budget Estimates 2026-27, which shows an increase of 3.19 per cent over Interim Budget Estimates of Rs 3,93,272 crore for 2026-27.
“This increase is attributable to mandatory outlays for new flagship commitments, agricultural crop loan waivers, 200 units of free electricity, and the Thaimaaman Thanga Mothiram scheme,” Wilson said.
The overall Capital Expenditure in the Interim Budget Estimates 2026-27 projected at Rs.59,562 crore, is estimated at Rs.56,985 crore in the Revised Budget Estimates 2026-27.
The Revenue Deficit is estimated to increase to Rs.55,775 crore in Revised Budget Estimates 2026-27, from Rs 48,696 crore in the interim budget estimates.
The Fiscal Deficit in Revised Budget Estimates 2026-27 is estimated at Rs.1,21,819 crore as against Rs.1,21,949 crore in Interim Budget Estimates 2026-27. As per the revised estimates, Fiscal Deficit is estimated to be 3.00 per cent of GSDP.
The Overall Outstanding liability of the State is estimated to be Rs.10,98,768 crore in the Revised Budget Estimates 2026-27 as against Rs.10,99,458 crore in the Interim Budget Estimates 2026-27.
The Outstanding Debt., that is, the overall liability to GSDP ratio in Revised Budget Estimates 2026-27 is estimated at 27.01 per cent as compared to 27.03 per cent in the Interim Budget Estimates 2026-27.
On the strength of the revenue augmentation measures, including improved tax administration and collection efficiency, revenue deficit is expected to narrow to Rs.53,933 crore in 2027-28, as per the budget speech.
The Government plans to avail a total loan amount of Rs.1,73,445 crore during 2026-27 and make repayment of Rs.51,971 crore.