Tamil Nadu Finance Minister Thangam Thennarasu on Tuesday, 2 September 2025, said that any reforms in the Goods and Services Tax (GST) structure should not undermine the state’s revenue receipts, stressing that collective decisions with safeguards are essential.
Speaking to reporters at the Secretariat, the minister said Tamil Nadu had managed to achieve double-digit economic growth despite limited support from the Centre. “In the absence of adequate central funds, we have relied on our own tax revenue. Those who point to loans must also recognise that we have stayed within the borrowing limits set by the Finance Commission, and that these borrowings have translated into tangible economic development,” he said.
He noted that the state had been reducing both revenue and fiscal deficits and emphasised that the focus should be on the effective use of borrowings. “What matters is how we spend. Loans have been used to fuel growth and improve key indicators,” he added.
On GST reforms, Thennarasu said Tamil Nadu was not opposed to restructuring but cautioned that the process should be carried out only after thorough examination. “Around 50 percent of Tamil Nadu’s tax revenue comes from GST. Any restructuring could create a major financial shortfall for us. The Centre must ensure that reforms do not deprive states like Tamil Nadu of vital revenue,” he said.
Highlighting the state’s spending priorities, he said Tamil Nadu was committed to investing in infrastructure and social welfare programmes. If revenue streams were cut while projects were underway, he warned, development works would be seriously affected.
“Our demand is clear – the Centre must safeguard our revenue sources while undertaking GST reforms so that the benefits reach the common man without causing financial losses to the state,” the minister said.
(With inputs from Dinamani)
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