<h1>Fiscal federalism: strong state tax collections and prudent debt management enhance claims in horizontal revenue devolution.</h1> Uttar Pradesh's fiscal position is underpinned by high own-tax collections relative to GSDP, disciplined budgetary expenditures, and a manageable debt-to-GDP ratio that limits interest costs and preserves developmental outlays. These internal strengths, combined with horizontal devolution rules that favor poorer states, enhance UP's entitlement in intergovernmental transfers. The state is advocating for a larger share of divisible tax revenue and special targeted development funds ahead of the 16th Finance Commission's recommendations for the 2026-27 to 2030-31 period.