Kerala Finance Minister K.N. Balagopal has spoken out about recent GST reductions, stressing that the benefits should reach everyday consumers, not just big businesses. The new tax cuts are set to take effect later this month, but Balagopal warned that the government will monitor whether people really feel the difference.
He emphasized, “The common people should see the benefit. Companies should not increase prices just because of the tax cuts. The government will step in if needed to ensure relief reaches those who need it most.”
Balagopal also expressed concerns that the central government did not promise compensation to states for the revenue loss caused by these GST cuts. Kerala alone estimates a revenue loss of around Rs 4,500 crore, mainly from savings on automobiles, cement, and other goods. He pointed out, “This isn’t about big announcements like demonetization; it’s about how these changes affect state finances.”
The Finance Minister criticized the GST Council’s decision to raise the tax on lotteries from 28% to 40%, calling it a big blow for around two lakh people who depend on lotteries for their livelihood. Kerala has asked that such decisions be left to individual states, especially since the lottery sector is so important to the local economy.
A special meeting is being planned to discuss ways to support the lottery industry during this challenging time.
Balagopal also warned that the GST cuts seem rushed and might be politically motivated ahead of upcoming elections. “The timing of these decisions can’t be ignored,” he said, hinting that political considerations might be influencing the move.
He assured that the state government is committed to making sure the benefits of GST reductions reach ordinary citizens and not just large companies, ensuring fair benefits for everyone.
