Abstract
Karnataka, one of India ‘s prominent economic states, relies significantly on Goods and Services Tax (GST) collections to support its infrastructure, public services, and welfare schemes. The dual disruptions brought by the implementation of GST and the COVID-19 pandemic posed serious fiscal challenges to the state. The pandemic caused major economic slowdowns—supply chain disruptions, declining consumer demand, and business closures—resulting in substantial fluctuations in GST revenue, a key indicator of economic activity and consumption. This study aims to evaluate the impact of the COVID-19 pandemic and GST transition on Karnataka ‘s revenue system, with particular emphasis on GST performance. The objective is to analyze trends, assess sectoral impacts, and examine policy responses to revenue shortfalls during the crisis. Empirical methods, including trend analysis and basic statistical tests, were applied to GST revenue data from 2019 to 2022. Sectoral analysis revealed that tourism, manufacturing, and IT experienced sharp downturns in GST contributions, while agriculture remained relatively resilient due to steady demand and policy support. Government interventions such as stimulus packages and GST compensation from the Centre mitigated the revenue decline to an extent. The study concludes that Karnataka ‘s revenue system is vulnerable to external shocks but can be strengthened through strategic reforms. Recommendations include diversifying the revenue base, enhancing digital tax infrastructure, and introducing sector-specific support mechanisms. Although focused on Karnataka, the study offers broader insights applicable to other Indian states navigating post-pandemic fiscal recovery.
KEYWORDS
GST Revenue, Fiscal Resilience, Economic Crisis, Public Finance, Fiscal Recovery.
Boya Saikumar1, Divya Mathur2*, M Thamizhselvi3
1MBA Student, NSB Academy, Bangalore-560099, Karnataka, India
2Assistant Professor, NSB Academy, Bangalore-560099, Karnataka, India
3Associate Professor, NSB Academy, Bangalore-560099, Karnataka, India