Karnataka Launches 'Know GST' Drive as UPI Tax Notices Spark Panic Among Small Traders
- Statewide ‘Know GST’ campaign launched to address panic over GST notices linked to UPI payments among unregistered traders.
- 14,000 traders flagged for exceeding GST thresholds; many issued notices demanding arrears up to Rs 40 lakh.
- Traders call strike and shutdown, while CM Siddaramaiah promises to raise issue at GST Council and engage stakeholders.
Amid rising anxiety among small and unregistered traders over Goods and Services Tax (GST) notices linked to UPI payments, the Karnataka government has launched a statewide awareness initiative titled ‘Know GST’ to clarify tax norms and restore confidence in digital transactions.
The move follows panic triggered by enforcement actions taken by the Commercial Taxes Department, which recently tracked over 14,000 unregistered traders using UPI transaction data. Many of these traders had reportedly received payments exceeding GST registration thresholds Rs 40 lakh for goods and Rs 20 lakh for services annually and were subsequently issued tax notices demanding arrears dating back to 2021-22, with some dues amounting up to Rs 40 lakh.
The first workshop under the ‘Know GST’ initiative was conducted in Koramangala, Bengaluru, where officials from the Commercial Taxes Department explained GST laws, thresholds, and compliance guidelines. The effort aims to reassure traders who have stopped accepting QR code-based payments and reverted to cash-only transactions, impacting the state’s digital payment ecosystem.
In a show of protest, affected traders have formed a forum under the Karnataka Karmika Parishat (KKP) and announced a two-day strike on July 23 and 24, followed by a statewide shutdown on July 25. They have further warned of halting the sale of essential commodities, including milk, if the matter is not addressed.
Chief Minister Siddaramaiah, who also holds the finance portfolio, has taken note of the situation. He assured protesting traders that their concerns would be raised at the upcoming GST Council meeting and instructed the Commercial Taxes Department to actively engage with stakeholders. This directive led to the rollout of the awareness campaign.
Adding to the pressure, BJP MLA S Suresh Kumar has pledged to discuss the issue with the Chief Minister, emphasizing the need to protect small-scale entrepreneurs from undue distress amid digital surveillance and tax enforcement.
The state government hopes the campaign will ease tensions and reinforce digital inclusion while ensuring tax compliance.
Also Read: Bengaluru Vendors Ditch UPI for Cash Amid GST Heat
