Karnataka Faces ₹15,000 Crore Annual Loss Under Centre’s Two-Slab GST Plan: CM Siddaramaiah

Swift Summary

• Karnataka Chief Minister Siddaramaiah raised concerns about the Center’s proposal to introduce two GST slabs, which could result in the State losing ₹15,000 crore annually.
• He emphasized that while rationalization of taxes is welcome, revenue protection for States should be prioritized.
• Siddaramaiah suggested a cess on luxury goods like cigarettes, gutka, pan masala, and luxury cars to compensate for lost revenue.
• Revenue Minister Krishna Byre Gowda will attend the GST Council meeting scheduled on September 3 and 4 to discuss proposed reforms further.
• siddaramaiah criticized BJP MPs from Karnataka for not addressing Karnataka’s concerns regarding GST reforms effectively.
• He reacted strongly to BJP’s plans for a yatra to dharmasthala amidst discussions on SIT investigations surrounding Dharmasthala-related issues.
• The SIT was constituted by his government following public demands and court testimony under Section 164; it has been tasked with uncovering the truth without political interference.

Indian Opinion Analysis

The proposed changes in India’s Goods and Services Tax (GST) framework have significant implications for State revenues-Karnataka Chief Minister Siddaramaiah’s estimates highlight potential annual losses of ₹15,000 crore if two tax slabs are introduced without adequate compensation mechanisms in place. His call for cesses on sin and luxury goods reflects an effort by states to safeguard their fiscal autonomy while adapting reforms within existing federal structures.

Criticism of political parties’ focus on religious pilgrimages amid vital economic discussions indicates underlying tensions between governance priorities versus electoral strategies. India’s tax system reform is frequently enough contentious as it seeks balance between national uniformity and state-specific economic realities; decisions made during upcoming GST Council meetings will likely impact not just Karnataka but other states facing similar revenue concerns.

Read more: The Hindu