When user run GW in CLI (which is the default case in KVM) he should get anon-connection-wizard popup to ask for enabling Tor + Running whonix check after that (this is the behavior in whonix-vbox).
Since this is not happening, Whonix-GW wont connect to tor thus no internet connection.
Easy Workaround: Increase RAM to 2GB for example to have a GUI entry then everything gonna work/connect normally.
cc @hulahoop