Kerala's GST Concerns: A Call for Revenue Protection

Kerala Finance Minister K N Balagopal voiced concerns over proposed GST reforms, urging the Centre to safeguard state revenues. He highlighted potential negative impacts on welfare schemes, salaries, and services, and questioned the lack of compensation. Balagopal emphasized the importance of tax cut benefits reaching common people while protecting state finances.

Thiruvananthapuram, August 26 (PT) - Kerala's Finance Minister K N Balagopal has raised alarms over the central government's proposed GST reforms, which he claims threaten the revenue of the states. Addressing the media, Balagopal called for measures to ensure that tax cuts benefit the common people without compromising the financial stability of state governments.

Highlighting a projected dip of Rs 8,000 to Rs 9,000 crore in Kerala's tax revenue, Balagopal warned of adverse effects on crucial social welfare programs, employee salaries, and vital public services like healthcare and education. He emphasized the necessity of revenue protection to maintain these functions, given the state's decrease in revenue and lack of alternative income sources.

The minister expressed his intentions to bring these concerns to the upcoming GST council meeting. However, he expressed skepticism about immediate remedial actions, noting that the proposed reforms could have the most severe post-independence impact on public finances. Despite the acknowledgment of the central government's diverse income sources, Balagopal stressed the need for compensation to support state governments effectively.

(With inputs from agencies.)