The introduction of Goods and Service Tax on 1st July, 2017 has revamped the tax structure and carved out a new path for the Indian economy. The new tax regime was envisioned to be free of all the problems of the previous tax system but, however since its proposal it has received mixed reviews from industries, academia and others. With extensive changes aimed at One Nation One Tax, it has left massive impact on the Small Scale Industries too. Hence this paper critically analyses the impact of Goods and Service Tax (GST) on Small Scale Industries specifically in Karnataka. Existing literature says that GST shall reduce the cost of doing business, increases transparency, decreases prices of product, increase tax compliance and improve ease of doing business. This paper proves some of these assertions through a primary data research and further identifies the need of reforms with respect to separation of definition of job work and labour work, penalties for non-payment of GST, dual administration and issues pending from the previous tax regime. It has also clearly established that composition scheme has been a non-performer and the reverse charge mechanism must be re-introduced later or revamped to balance its costs and benefits. Thus the study has implications for policy makers, industries and academia and also provides a better understanding of the new tax system itself.