Micro, Small and Medium Enterprises (MSMEs) would greatly benefit from the next-generation GST reforms announced by the Union government on Wednesday, owing to the reduced GST compliance burdens, faster refunds, and lower tax rates. The reforms enable MSMEs to focus on growth, innovation, and job creation, thereby contributing increasingly to Karnataka’s economic growth, said the trade bodies on Thursday.
Under the new GST regime, which is scheduled to take effect on September 22, MSMEs will be able to enjoy a range of benefits, including simplified registration with automatic approval within 30 days, ease of compliance through reduced paperwork and streamlined filing, and faster refunds, among other benefits, they said.
M.G. Balakrishna, president, Federation of Karnataka Chambers of Commerce and Industry (FKCCI), said that these decisive tax reforms would provide relief to consumers and also ensure fiscal responsibility and trade facilitation. “We believe these measures will accelerate economic momentum, encourage investments, and help reinvigorate Karnataka’s industrial and commercial landscape,’‘ Mr. Balakrishna said.
The GST structure would be rationalised and simplified into two-tier tax slabs of 5% and 18%, replacing the earlier complexity of four slabs.
According to Mr. Balakrishna, simplifying the tax slab structure streamlines pricing, inventory planning, and compliance, which would particularly benefit small businesses and small traders who operate on thin margins.
“By making GST more accessible, these businesses can now focus more on growth and innovation rather than tax complexities,’‘ he added.
B.R. Ganesh Rao, president, Karnataka Small Scale Industries Association (KASSIA), said the new reforms were particularly beneficial for MSMEs, which form the backbone of the Indian economy.
A lower GST burden would also boost entrepreneurship across sectors such as agriculture, healthcare, and education, Mr. Rao said, adding, “We also expect that issues concerning the policy decision on labour charges, timely refunds, QRMP [quarterly return monthly payment of taxes] and the rationalisation of tax on still-highly taxed essential goods such as batteries, etc., will be addressed in the next round of reforms.”
The proposed GST revision is expected to benefit large, medium, and MSME sectors by increasing production capacities, improving competitiveness, and enhancing their overall growth prospects, as per K. Ravi, senior vice-president, Bangalore Chamber of Industry and Commerce (BCIC).
Published – September 04, 2025 09:10 pm IST
