Karnataka Minister Warns: GST 2.0 May Cost States Rs 1.5 Lakh Crore Revenue Loss

The rollout of GST 2.0 has raised alarm among several Indian states, with Karnataka’s finance minister highlighting a significant revenue shortfall of Rs 1.5 lakh crore. This gap stems from changes in tax structures and adjustments in compensation mechanisms that states heavily rely on. State governments worry that reduced funds could stall ongoing infrastructure and social welfare initiatives. As GST remains a shared responsibility between the Centre and states, this development threatens to unsettle fiscal dynamics. Discussions are expected to intensify on how to manage the shortfall without compromising governance or public services. The minister’s remarks to NDTV have renewed attention on the challenges GST 2.0 poses.