Siddaramaiah Flags GST Revenue Loss, Seeks 50% Pan Masala Cess Share From Centre

• Karnataka CM Siddaramaiah warned PM Modi that GST rate cuts are causing severe financial strain on states, citing a significant slowdown in national and state GST collections.
• Siddaramaiah highlighted a major slowdown in national GST collections, with growth dropping to 3.3% (Sept-Nov 2025) from 9% the previous year, and Karnataka's growth at 3.1%.
• Karnataka projects a revenue shortfall of Rs 5000 crore this year and Rs 9000 crore in 2025-26, in addition to Rs 9500 crore loss from non-merger of compensation cess.
• The CM criticized the pan masala cess, stating it deprives states of their fair share and urged the Centre to share 50% of the cess with states.
• Siddaramaiah demanded compensation for states' revenue loss due to GST rationalisation and proposed fixing 2024-25 as the new base year for revenue collections.

Why It Matters: GST revenue loss threatens state finances and public services.