GST rate cut must benefit people, not increase profits of big corporates: Siddaramaiah

Chief Minister Siddaramaiah on Friday said that the Centre and the Central Board of Indirect Taxes & Customs (CBIC) must ensure the GST rate cuts would lead to lower prices for people, not increase the profit margins of big corporates. “If the benefits fail to reach the common man, the blame will rest squarely on the Union Government,” the CM said in a statement.

While welcoming the GST Council’s decision to cut the GST rates, he urged the Centre to provide the state with its rightful share of the GST compensation cess that it continues to collect as the state was estimated to lose about Rs 15,000-Rs 20,000 crores in annual revenues due to the GST reforms.

The CM called the decision of the GST Council to cut the tax rates on a range of commodities an important step to reduce both the monetary and compliance burden on people and businesses.


The Council’s decision, he added in his statement, was, however, not a new wisdom but a long-delayed acceptance of what AICC leader Rahul Gandhi, Opposition leaders, and opposition-ruled states demanded since 2016-2017, when “the Modi Government hurriedly rolled out a faulty GST. From the very beginning, we had warned that this “Gabbar Singh Tax” would crush small businesses, increase compliance costs, and burden ordinary families. Sadly, Prime Minister Narendra Modi chose to ignore these warnings for eight long years.”

The GST system, Siddaramaiah said, gave the Union Government one-third of the total voting power, while all states together share the remaining two-thirds. For any reform, a three-fourths majority was needed. This means that even if all states agree, a stubborn Central Government could block reforms. “That is exactly what Mr. Modi’s government did. Today’s course correction proves that our stand was right all along. The people of India could have been spared years of hardship had the Union Government listened earlier.”

Karnataka alone may lose ₹15,000–20,000 crore in revenue due to the GST rate cuts. Nonetheless, Karnataka welcomed it keeping the welfare of our people above everything else.

“As a state, we remain committed to building an economy that increases people’s purchasing power, widens the tax base, and ensures prosperity for all.”